<PAGE> 1
As filed with the Securities and Exchange Commission on November 4, 1997
Registration No. 333-_____
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
RURAL/METRO CORPORATION
(Exact name of registrant as specified in its Charter)
<TABLE>
<CAPTION>
DELAWARE 86-0746929
<S> <C>
(STATE OR OTHER JURISDICTION OF INCORPORATION) (I.R.S. EMPLOYER IDENTIFICATION NUMBER)
</TABLE>
---------------
8401 EAST INDIAN SCHOOL ROAD
SCOTTSDALE, ARIZONA 85251
(602) 994-3886
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
---------------
WARREN S. RUSTAND
RURAL/METRO CORPORATION
8401 EAST INDIAN SCHOOL ROAD
SCOTTSDALE, ARIZONA 85251
(602) 994-3886
(NAME, ADDRESS INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
---------------
with a copy to:
Jean E. Harris, Esq.
O'Connor, Cavanagh, Anderson,
Killingsworth & Beshears
One East Camelback, Suite 1100
Phoenix, Arizona 85012-1656
---------------
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, AS AMENDED (THE "SECURITIES ACT"), OTHER THAN SECURITIES OFFERED ONLY IN
CONNECTION WITH DIVIDEND OR INTEREST REINVESTMENT PLANS, CHECK THE FOLLOWING
BOX. /X/
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. / /
<PAGE> 2
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
================================================================================================================================
Proposed Proposed
Amount Maximum Maximum Amount of
Title of Shares to be Aggregate Price Aggregate Registration
to be Registered Registered Per Unit(1) Offering Price(1) Fee
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 143,505 Shares $33.065 $4,744,993 $1,437.88
================================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c).
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT 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> 3
143,505 SHARES
RURAL/METRO CORPORATION
COMMON STOCK
This Prospectus is being used in connection with the offering from time
to time by stockholders of Rural/Metro Corporation (the "Company" or
"Registrant"), or their respective transferees, pledgees, donees, legatees,
heirs, or legal representatives (collectively, the "Selling Stockholders"), some
of whom may be deemed "affiliates" of the Company as defined in Rule 405 under
the Securities Act of 1933 (the "Securities Act"), of shares of the Company's
common stock, par value $.01 per share (the "Common Stock" or the "Shares"),
previously received from the Company prior to the Company's initial public
offering. See "Selling Stockholders."
It is expected that sales made pursuant to this Prospectus will be
effected in broker's transactions, in transactions directly with market makers,
in negotiated sales or otherwise, with the timing and manner of sales to be
determined by the Selling Stockholders, in each case at market prices prevailing
at the time of sale, at prices related to prevailing market prices or at
negotiated prices. The Company will not receive any of the proceeds from the
sale of these shares. The Selling Stockholders may effect sales of shares of
Common Stock by selling shares to or through brokers and dealers and such
brokers and dealers may receive compensation in the form of underwriting
discounts, concessions or commissions from the Selling Stockholders and/or
purchasers of shares for whom they may act as agent (which compensation may be
in excess of customary commissions). The Selling Stockholders and the brokers
and dealers through whom sales of shares may be effected may be deemed to be
"underwriters" within the meaning of the Securities Act, and any commissions
received and any profits realized by them on the sale of shares may be
considered to be underwriting compensation.
The shares of Common Stock are listed on the Nasdaq National Market
under the symbol "RURL." On October 31, 1997, the last reported sale price of
the Common Stock as reported on the Nasdaq National Market was $34.75 per share.
-------------------------
PROSPECTIVE INVESTORS SHOULD CAREFULLY CONSIDER THE MATTERS DISCUSSED
UNDER "RISK FACTORS" BEGINNING ON PAGE 5 OF THIS PROSPECTUS.
-------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
-------------------------
The date of this Prospectus is November ____, 1997.
<PAGE> 4
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, heretofore filed by the Company with the
Securities and Exchange Commission (the "Commission") pursuant to the Securities
Exchange Act of 1934 (the "Exchange Act"), are hereby incorporated by reference,
except as superseded or modified herein:
1. The Company's Annual Report on Form 10-K for the fiscal year ended
June 30, 1997;
2. The Company's Current Report on Form 8-K dated July 15, 1997, as
amended by the Form 8-K/A dated August 12, 1997; and
3. The Company's Registration Statement on Form 8-A filed July 8, 1993,
as amended by Form 8-A/A filed February 2, 1995, registering the Company's
Common Stock under 12(g) of the Exchange Act as it applies to the description of
the Company's Common Stock.
Each document filed subsequent to the date of this Prospectus pursuant
to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the
termination of the offering shall be deemed to be incorporated by reference in
this Prospectus and shall be a part hereof from the date of filing of such
document. 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 that also is (or is deemed to be)
incorporated by reference herein, modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of the Registration Statement or this
Prospectus.
The Company will provide without charge to each person, including any
beneficial owner, to whom a copy of this Prospectus is delivered, upon the
written or oral request of any such person, a copy of any document described
above (other than exhibits). Requests for such copies should be directed to
Rural/Metro Corporation, 8401 East Indian School Road, Scottsdale, Arizona
85251, Attention: Investor Relations Department, telephone (602) 994-3886.
2
<PAGE> 5
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by the more detailed
information and consolidated financial statements appearing elsewhere or
incorporated by reference in this Prospectus. This Prospectus contains
forward-looking statements which involve risks and uncertainties. The Company's
actual results may differ materially from the results discussed in the
forward-looking statements. Factors that might cause such a difference include,
but are not limited to, those discussed under "Risk Factors."
THE COMPANY
The Company provides "911" emergency and general transport ambulance
services, fire protection services, and other safety and health care related
services to municipal, residential, commercial, and industrial customers. The
Company believes that it is the only multi-state provider of both ambulance and
fire protection services in the United States and that it ranks as one of the
largest private-sector providers of ambulance services and fire protection
services in the world. The Company currently serves over 350 communities in 21
states, Canada, and Latin America. Ambulance services and fire protection
services accounted for approximately 81% and 13%, respectively, of the Company's
revenue for the fiscal year ended June 30, 1997.
Founded in 1948, the Company has been instrumental in the
development of protocols and policies applicable to the emergency services
industry. The Company has grown significantly since the late 1970s both through
internal growth and through acquisitions. To manage this growth, the Company
invested in the development of management and operational systems that have
resulted in productivity gains and increased profitability. The Company believes
its current systems and controls position it to continue its growth internally
as well as through acquisitions and enable it to operate profitably in both
large and small communities. The Company completed eight acquisitions in the
fiscal year ended June 30, 1994, 11 acquisitions in the fiscal year ended June
30, 1995, 18 acquisitions in the fiscal year ended June 30, 1996, and 19
acquisitions in the fiscal year ended June 30, 1997.
Based on generally available industry data, it is estimated that annual
expenditures for ambulance services in the United States are between $4 billion
and $7 billion. Various factors, including the growth and aging of the
population, and trends towards the use of outpatient services and specialized
treatment facilities in an effort to contain health care costs have increased
the demand for ambulance services. At the same time, industry factors have
increased t e standards of pre-hospital emergency care and have required faster
ambulance response times, increasing the capital and technological resources
necessary to provide higher levels of service. These factors, combined with the
historically fragmented nature of the ambulance service industry, are
contributing to consolidation within the industry.
Market-driven forces changing the health care industry are impacting
the ambulance industry as well. The Company believes the trend toward managed
care and away from fee-for-service arrangements is furthering industry
consolidation. The move to managed care benefits larger ambulance services
providers, which can service a larger portion of a managed care provider's
needs. This allows the managed care provider to reduce its number of suppliers,
cutting administrative costs and allowing them to negotiate more favorable
rates.
Volunteer fire departments, tax-supported fire districts, and municipal
fire departments constitute the primary providers of fire protection services in
the United States. Because emergency medical response represents a significant
portion of fire response activity within many fire departments, the Company
believes that its ambulance and fire protection services operations are
complementary. The Company believes that its integration of such services can
provide operating economies, optimal coordination of the delivery of services,
efficiencies in the use of personnel and equipment, and enhanced levels of
service, especially in lower- utilization communities. Additionally, a variety
of economic pressures on the public sector may increase opportunities for
privatization and public/private partnerships in fire protection services.
The Company pursues a strategy designed to enable it to expand its
business in existing service areas, establish additional service areas both
domestically and internationally, respond to the needs of the public sector and
health ca e providers, expand fire protection services, integrate existing
services, and improve productivity. This strategy includes plans to (i) acquire
additional ambulance service providers operating in metropolitan areas and in
communities
3
<PAGE> 6
surrounding the metropolitan areas that the Company currently serves or plans to
serve; (ii) expand its emergency ambulance services through the pursuit of new
contracts with municipalities and fire districts and its general ambulance
services through increased marketing efforts to, and pursuit of other alliances
with, managed care providers and other health care providers; (iii) expand its
fire protection services into selected additional service areas through the
pursuit of opportunities to supplant or enhance services provided by volunteer
fire departments, expand its services to newly developed communities, and to
develop public/private partnerships with tax supported fire districts and
municipal fire departments; (iv) continue the integration of its fire protection
and ambulance services to maximize operational efficiencies and synergies; and
(v) improve its productivity through the more efficient utilization of equipment
and personnel.
The Company was incorporated in Arizona in 1948 and reincorporated in
Delaware in May 1993. Unless the context indicates otherwise, all references to
the "Company" refer to Rural/Metro Corporation and its subsidiaries. The Company
maintains its principal executive offices at 8401 East Indian School Road,
Scottsdale, Arizona 85251, and its telephone number is (602) 994-3886.
SUMMARY FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
FISCAL YEAR ENDED JUNE 30, 1997
OPERATING DATA: 1995 1996 1997
---- ---- ----
<S> <C> <C> <C>
Revenue.................................................... $171,583 $250,263 $319,805
Operating income........................................... 15,940 24,664 27,804
Interest expense, net...................................... 3,059 5,108 5,720
Net income(1).............................................. 6,900 11,512 12,720
Earnings per share(2)...................................... $0.84 $1.14 $1.04
Weighted average number of shares.......................... 8,249 10,075 12,271
JUNE 30,
BALANCE SHEET DATA: 1997
----
Working capital.................................................................... $ 94,766
Total assets....................................................................... 364,066
Current portion of long-term debt.................................................. 9,814
Long-term debt, net of current portion............................................. 144,643
Total stockholders' equity......................................................... 159,808
</TABLE>
- --------------------
(1) Net income for the year ended June 30, 1995 reflects the effect of an
extraordinary loss of $693,000.
(2) Earnings per share for the year ended June 30, 1995 include the effect of an
extraordinary loss of $0.08 per share.
4
<PAGE> 7
RISK FACTORS
DEPENDENCE ON CERTAIN BUSINESS RELATIONSHIPS
The Company depends to a great extent on certain contracts with munic-
palities or fire districts to provide "911" emergency ambulance services and
fire protection services. The Company's five largest contracts accounted for
approximately 22% and 18% of total revenue for the fiscal years ended June 30,
1996 and 1997 respectively, with one contract accounting for approximately 7%
and 5% of total revenue for the same periods. The loss or cancellation of any
one or more of these contracts could have a material adverse effect on the
Company and its operations. No assurance can be given that the Company will be
successful in retaining its existing contracts or in obtaining new contracts for
ambulance services or for fire protection services. The Company also faces the
risk that areas in which it provides fire protection services through
subscription arrangements with residents and businesses will be converted to
tax-supported fire districts or annexed by municipalities.
ACQUISITION STRATEGY
The Company's strategy with respect to ambulance services depends in large
part on its continued ability to acquire and to operate successfully additional
ambulance service providers. The Company completed eight acquisitions in fiscal
1994, 11 acquisitions in fiscal 1995, 16 acquisitions in fiscal 1996, and 18
acquisitions of ambulance service providers in 1997. There can be no assurance
that the Company will be able to identify additional suitable acquisition
candidates, that it will be able to consummate any such acquisitions, or that it
will be able to integrate any such acquisitions successfully into its
operations. The Company expects to use cash and securities, including Common
Stock, as the principal consideration for future acquisitions. The Company's
acquisition program could be adversely affected if the Company does not generate
sufficient cash for future acquisitions from existing operations or through
external financings. There can be no assurance that the Company's operations
will generate sufficient cash for acquisitions, that any additional financings
for acquisitions will be available if and when needed or on terms acceptable to
the Company, or that financing that is obtained will be able to be deployed on a
prompt basis.
POSSIBLE ADVERSE CHANGES IN REIMBURSEMENT RATES OF COVERAGE
Payments received from third-party payors (including Medicare, Medicaid,
and private insurers represent a substantial portion of the Company's ambulance
receipts. The Company derived approximately 79% and 74% of its net ambulance fee
collections from such third-party payors during 1996 and 1997; including 27% and
26% from Medicare, respectively. There are continuing efforts of third-party
payors to control expenditures for health care, including proposals to revise
reimbursement policies.
During June 1997 HCFA issued proposed rules that would revise Medicare
policy on the coverage of ambulance services. These proposed rules have been
subject to public comment and, despite the passage of new law addressing changes
to the reimbursement of ambulance services by Medicare (discussed below), have
not yet been withdrawn. The proposed new HCFA rules have not been finalized.
In addition, in August 1997, the Budget Act became law. The Budget Act
provides for the development, negotiation, and implementation of a prospective
fee schedule for ambulance services between HCFA and ambulance service providers
by January 2000. The Budget Act also reduces the annual rate adjustment for
Medicare reimbursements from the Consumer Price Index (CPI) to CPI less one
percentage point.
If the proposed HCFA rules were to be finalized prior to the negotiation of
a prospective fee schedule as stipulated in the Budget Act, and the Company were
unable to mitigate the effect of the new rules, the Company's results of
operations could be adversely effected. The final outcome of the proposed rules
and the effect of the prospective fee schedule is uncertain. However, changes in
reimbursement policies, or other government action, together with the financial
instability of private third-party payors and budget pressures on payor sources
could influence the timing and, potentially, the ultimate receipt of
reimbursements. A reduction in coverage or reimbursement rates by third-party
payors could have a material adverse effect on the Company's results of
operations.
5
<PAGE> 8
IMPACT OF RATE STRUCTURES AND LIMITATIONS ON RATES OF RETURN
State or local government regulations or administrative policies regulate
rate structures in most states in which the Company conducts ambulance
operations. In certain service areas in which the Company is the exclusive
provider of services, the municipality or fire district sets the rates for
emergency service pursuant to a master contract and establishes the rates for
general ambulance services that the Company is permitted to charge. Rates in
most service areas are set at the same amounts for emergency and general
ambulance services. The State of Arizona establishes a rate of return on sales
the Company is permitted to earn in determining the ambulance service rates the
Company may charge in that state. Ambulance services revenue generated in
Arizona accounted for approximately 11% and 9% of total revenue for the fiscal
years ended June 30, 1996 and 1997, respectively. No assurance can be given that
the Company will be able to receive ambulance service rate increases on a timely
basis where rates are regulated or to establish or maintain satisfactory rate
structures where rates are not regulated. Under present coverage programs with
third-party payors, the Company faces the continuing risk of nonreimbursement to
the extent that uninsured individuals require ambulance service. Changes in
demographics in the Company's markets could increase the Company's risk of
doubtful accounts which, in turn, could have a material adverse effect on the
Company's operating results.
Municipalities and fire districts negotiate the payments to be made to the
Company for fire protection services pursuant to master contracts. These master
contracts are based on a budget and on level of effort or performance criteria
desired by the municipalities and fire districts. No assurance can be given that
the Company will be successful in negotiating or maintaining profitable
contracts with municipalities and fire districts.
GOVERNMENTAL REGULATION
Numerous federal, state, and local laws and regulations govern various
aspects of the business of ambulance service providers, covering matters such as
licensing, rates, employee certification, environmental matters, and other
factors. Certificates of necessity may be required from state or local
governments to operate ambulance services in a designated service area. Master
contracts from governmental authorities are subject to risks of cancellation or
unenforceability as a result of budgetary and other factors and may subject the
Company to certain liabilities or restrictions which traditionally have applied
only to governmental bodies or to which they are otherwise immune. There can be
no assurance that federal, state, or local governments will not adopt laws or
regulations that would increase the Company's cost of doing business, lower
reimbursement levels, or otherwise have a material adverse effect on the
Company's business.
INDUSTRY CONSIDERATIONS
Numerous legislative proposals have been considered that would result in
major reforms in the United States health care system. The Company cannot
predict which, if any, health care reforms may be proposed or enacted or the
effect that any such legislation would have on the Company's business. In
addition, managed care providers are attempting to contain health care costs
through the use of outpatient services and specialized treatment facilities. No
assurance can be given that changing industry practices will not have an adverse
effect on the Company.
COMPETITION
The ambulance service industry is highly competitive. The Company currently
encounters competition in providing ambulance services from governmental
entities (including fire districts), hospitals, other national ambulance service
providers, large regional ambulance service providers, and numerous local and
volunteer private providers. In addition, there can be no assurance that
municipalities, fire districts, or health care organizations that currently
contract for ambulance services will not choose to provide ambulance services
directly in the future. The Company is experiencing increased competition from
fire departments to provide emergency ambulance service. Some of the Company's
current competitors and certain potential competitors have greater capital and
other resources than the Company. Tax-supported fire districts, municipal fire
departments, and volunteer fire departments represent the principal providers of
fire protection services for residential and commercial properties. Private
providers represent only a small portion of the total fire protection market and
generally provide services where a tax-supported municipality or fire district
has decided to contract for the provision of fire protection services or has not
assumed the financial responsibility for fire protection.
6
<PAGE> 9
In these situations, the Company provides services for a municipality or fire
district on a contract basis or provides fire protection services directly to
residences and businesses on a subscription basis. There can be no assurance
that the Company will be able to obtain additional fire protection businesses on
a contractual or subscription basis, that fire districts or municipalities will
not choose to provide fire protection services directly in the future, or that
areas in which the Company provides services through subscriptions will not be
converted to tax-supported fire districts or annexed by municipalities.
DEPENDENCE ON MANAGEMENT AND OTHER KEY PERSONNEL
The Company's success depends upon the retention of principal key personnel
and the recruitment and retention of additional key personnel. The loss of
existing key personnel or the failure to recruit and retain necessary additional
personnel would adversely affect the Company's business prospects. There can be
no assurance that the Company will be able to retain its current personnel or
attract and retain necessary additional personnel. The Company's internal growth
and its expansion into new geographic areas will require additional expertise,
such as marketing and operational management. These growth and expansion
activities will further increase the demand on the Company's resources and
require the addition of new personnel and the development of additional
expertise by existing personnel. The failure of the Company to attract and
retain personnel with the requisite expertise or to develop internally such
expertise could adversely affect the prospects for the Company's success. The
Company entered into three-year employment agreements with its executive
officers in May 1993, which were renewed in December 1995, and has entered into
similar agreements with certain other executive officers as they have joined the
Company. The Company maintains "key person" insurance on several of its key
executive officers.
CONTROL BY CURRENT STOCKHOLDERS
The directors, executive officers, and their affiliates currently own
beneficially approximately 10%, and the Company's Employee Stock Ownership Plan
(the "ESOP") currently holds approximately 8%, of the outstanding shares of
Common Stock. Accordingly, these persons, if they act as a group, likely will be
able to significantly influence the election of the Company's directors and the
outcome of matters requiring approval by the stockholders of the Company.
CHANGE IN CONTROL PROVISIONS
The Company's Second Restated Certificate of Incorporation (the "Restated
Certificate") and the Delaware General Corporation Law (the "General Corporation
Law") contain provisions that may have the effect of making more difficult or
delaying attempts by others to obtain control of the Company, even when these
attempts may be in the best interests of stockholders. The Restated Certificate
also authorizes the Board of Directors, without stockholder approval, to issue
one or more series of preferred stock which could have voting and conversion
rights that adversely affect the voting power of the holders of Common Stock and
provides for a classified board of directors. The General Corporation Law also
imposes conditions on certain business combination transactions with "interested
stockholders" (as defined therein).
The Company has also adopted a Rights Plan whereby, if and when the Rights
become exercisable, holders of shares of Common Stock will be entitled to
purchase one one-thousandth of a share of Series A Junior Participating
Preferred Stock at a purchase price of $145 (subject to certain antidilution
adjustments). The Rights will expire 10 years after issuance, and will be
exercisable only if a person or group becomes the beneficial owner of 15% or
more of the Common Stock (such person or group, a "15% holder") or commences a
tender or exchange offer which would result in the offeror beneficially owning
15% or more of the Common Stock. If the Rights become exercisable, each Right,
unless redeemed by the Company, entitles the holder to purchase for $145 an
amount of Common Stock of the Company, or in certain circumstances a combination
of securities and/or assets or the common stock of the acquiror, having a market
value of twice the purchase price.
The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the Company
on terms not approved by the Company's Board of Directors, except pursuant to an
offer conditioned on a substantial number of Rights being acquired. The Rights
should not interfere with any merger or other business combination approved by
the Board of Directors since the Rights may be redeemed by the Company
7
<PAGE> 10
at $.01 per Right prior to 10 days (as such period may be extended) after the
public announcement of the existence of a 15% holder.
POSSIBLE VOLATILITY OF STOCK
The market price of the Company's Common Stock has increased since the
Company's initial public offering in July 1993. The period was marked by
generally rising stock prices, favorable industry conditions, and improved
operating results by the Company. The trading price of the Company's Common
Stock in the future could be subject to wide fluctuations in response to
quarterly variations in operating results of the Company and others in its
industry, actual or anticipated announcements concerning the Company or its
competitors, including government regulations and reimbursement changes, the
announcement and implementation of health care reform proposals, changes in
analysts' estimates of the Company's financial performance, general conditions
in the health care industry, general economic and financial conditions, and
other events or factors. In addition, the stock market has experienced extreme
price and volume fluctuations which have affected the market prices for many
companies involved in health care and related industries and which often have
been unrelated to the operating performance of such companies. These broad
market fluctuations and other factors may adversely affect the market price of
the Company's Common Stock.
SHARES ELIGIBLE FOR FUTURE SALE
Sales of substantial amounts of Common Stock in the public market could
adversely affect prevailing market prices. As of October 20, 1997, there were
13,510,212 shares of Common Stock outstanding, 10,226,959 shares of which were
freely transferable without restriction under the Securities Act of 1933, as
amended (the "Securities Act"), unless held by an "affiliate" of the Company, as
that term is defined under the Securities Act. The Company also has outstanding
136,313 restricted shares, as that term is defined under Rule 144 (the
"Restricted Shares") under the Securities Act, that are eligible for sale in the
public market subject to compliance with the holding period, volume limitations,
and other requirements of Rule 144. In addition, the Company has registered
6,646,940 shares of Common Stock for issuance in connection with acquisitions
(of which 3,146,940 shares have been issued), which shares are generally freely
tradeable after their issuance under Rule 145 of the Securities Act, unless held
by an affiliate of the acquired company, in which case such shares will be
subject to the volume and manner of sale restrictions under Rule 144.
The Company has registered for offer and sale up to 3,965,625 shares of
Common Stock that are reserved for issuance pursuant to the Company's stock
option plans. Shares issued after the effective date of such registration
statement upon the exercise of stock options issued under the Company's stock
option plans generally will be eligible for sale in the public market, except
that affiliates of the Company will continue to be subject to volume
limitations. The Company also has the authority to issue additional shares of
Common Stock and shares of one or more series of Preferred Stock. The issuance
of such shares could have a dilutive effect on earnings per share, and the sale
of such shares could depress the market price of the Company's Common Stock.
8
<PAGE> 11
SELLING STOCKHOLDERS
The following table sets forth (i) the name of each Selling Stockholder,
all of whom are or are affiliated with current officers or directors of the
Company, (ii) the number of shares of Common Stock of the Company beneficially
owned by each Selling Stockholder as of October 10, 1997, and (iii) the number
of shares of Common Stock owned by each Selling Stockholder, and which he or it
may offer and sell pursuant to this Prospectus.
<TABLE>
<CAPTION>
NUMBER OF SHARES NUMBER OF SHARES
OF COMMON STOCK OF COMMON STOCK
OWNED WHICH MAY BE OFFERED
NAME (1)(2)(3) PERCENT PURSUANT HERETO
------------------------ --------- ------- ---------------
<S> <C> <C> <C>
Bolin Revocable Trust(4)................... 251,172 1.8 25,000
Robert T. Edwards(5)....................... 173,946 1.3 15,000
Louis G. Jekel Family Limited
Partnership(6).......................... 144,013 1.1 40,000
William R. Crowell(7)...................... 97,464 * 16,500
Stenger Charitable Remainder Trust and
Stenger Family Trust(8)................. 130,384 * 32,005
Michel A. Sucher(9)........................ 79,622 * 15,000
</TABLE>
- -------------------
* Less than one percent
(1) Except as indicated, and subject to community property laws when
applicable, the persons named in the table above have sole voting and
investment power with respect to all shares of Common Stock shown as
beneficially owned by them.
(2) Includes shares of Common Stock issuable pursuant to stock options that
may be exercised within 60 days after October 10, 1997. In calculating the
percentage of ownership, such shares are deemed to be outstanding for the
purpose of computing the percentage of shares of Common Stock owned by
such person, but are not deemed to be outstanding for the purpose of
computing the percentage of shares of Common Stock owned by any other
stockholders.
(3) Excludes 29,298, 22,914, 5,661, 15,292, and 1,093 fully vested shares held
by the ESOP for the benefit of Messrs. Bolin, Edwards, Jekel, Stenger, and
Sucher, respectively, and 372 shares held by the ESOP for the benefit of
Mr. Crowell that is 60% vested. Such persons have sole voting power with
respect to the shares held in their account by the ESOP.
(4) Includes 131,818 shares of Common Stock issuable upon exercise of stock
options held by James H. Bolin and 119,354 shares held by the Bolin
Revocable Trust UA dated February 27, 1996, James H. Bolin and Sandra L.
Bolin, Trustees.
(5) Includes 142,981 shares of Common Stock issuable upon exercise of stock
options.
(6) Includes 62,500 shares of Common Stock issuable upon exercise of stock
options held by Louis G. Jekel and 81,336 shares held by the Louis G.
Jekel Family Limited Partnership of which Mr. Jekel is a beneficial owner.
(7) Includes 79,893 shares of Common Stock issuable upon exercise of stock
options.
(8) Includes 80,018 shares of Common Stock issuable upon exercise of stock
options held by James E. Stenger, 14,650 shares held by the Stenger
Charitable Remainder Trust UA dated December 23, 1996, James E. Stenger
and Sharon E. Stenger, Trustees, and 17,355 shares held by the Stenger
Family Trust UA dated October 17, 1996, James E.
Stenger and Sharon E. Stenger, Trustees.
(9) Includes 45,986 shares of Common Stock issuable upon exercise of stock
options.
9
<PAGE> 12
PLAN OF DISTRIBUTION
This Prospectus, as appropriate amended or supplemented, may be used from
time to time to sell certain Shares of Common Stock issued prior to the
Company's initial public offering by the persons named herein, or their
transferees, pledgees, donees, legatees, heirs, or legal representatives who
wish to offer and sell such Shares (such persons are herein referred to as the
"Selling Stockholder" or "Selling Stockholders") in transactions in which they
and any person acting on their behalf through whom such Shares are sold may be
deemed to be underwriters within the meaning of the Securities Act. The Company
will receive none of the proceeds from any such sales. The Company will pay
substantially all of the expenses incident to this offering of the Shares by the
Selling Stockholders to the public other than commissions and discounts of
underwriters, brokers, dealers or agents.
There presently are no arrangements or understandings, formal or informal,
pertaining to the distribution of the Shares described herein. Upon the Company
being notified by a Selling Stockholder that any material arrangements have been
entered into for the sale of the Shares, to the extent required, the Company
will file, during any period in which offers or sales are being made, one or
more supplements to this Prospectus to set forth the names of Selling
Stockholders and any other material information with respect to the plan of
distribution not previously disclosed. In addition, any Shares which qualify for
sale pursuant to Section 4 of, or Rules 144 or 144A under, the Securities Act
may be sold under such provisions rather than pursuant to this Prospectus.
Selling Stockholders may sell the Shares being offered hereby from time to
time in transactions (which may involve crosses and block transactions) on the
Nasdaq National Market at market prices prevailing at the time of sale, at
prices related to such prevailing market prices, at negotiated prices, at fixed
prices, or in transactions directly to one or more purchasers, including
pledgees in privately negotiated transactions (including sales pursuant to
pledges). Selling Stockholders may sell some or all of the Shares in
transactions involving broker-dealers, who may act either as agent or as
principal. Broker-dealers participating in such transactions as agent may
receive commissions from Selling Stockholders (and, if they act as agent for the
purchaser of such Shares, from such purchaser), such commissions computed in
appropriate cases in accordance with the applicable rules of the Nasdaq National
Market, which commissions may be at negotiated rates where permissible under
such rules.
Participating broker-dealers may agree with Selling Stockholders to sell a
specified number of Shares at a stipulated price per share and, to the extent
such broker-dealer is unable to do so acting as an agent for Selling
Stockholders, to purchase as principal any unsold Shares at the price required
to fulfill the broker-dealer's commitment to Selling Stockholders. In addition
or alternatively, Shares may be sold by Selling Stockholders and/or by or
through other broker-dealers in special offerings or secondary distributions
pursuant to and in compliance with the governing rules of the Nasdaq National
Market, and in connection therewith commissions in excess of the customary
commissions prescribed by the rules of Nasdaq National Market may be paid to
participating broker-dealers, or, in the case of certain secondary
distributions, a discount or concession from the offering price may be allowed
to participating broker-dealers in excess of the customary commission.
Broker-dealers who acquire Shares as principal may be thereafter resell such
Shares from time to time in transactions (which may involve crosses and block
transactions and which may involve sales or through other broker-dealers,
including transactions of the nature described in the preceding two sentences)
on Nasdaq National Market, in negotiated transactions or otherwise, at market
prices prevailing at the time of sale or at negotiated prices, and in connection
with such resales may pay to or receive commissions from the purchaser of such
Shares.
Selling Stockholders will be subject to applicable provisions of the
Exchange Act and the rules and regulations thereunder, including without
limitation Regulation M, which provisions may limit the timing of purchases and
sales of any of the Shares by the Selling Stockholders. All of the foregoing may
affect the marketability of the Shares.
If the Shares are sold in an underwritten offering, the underwriters and
selling group members (if any) may engage in passive market making transactions
in the Common Stock on Nasdaq immediately prior to the commencement of the
offering in accordance with Regulation M. Passive market making presently
consists of displaying bids on Nasdaq limited by the bid prices of market makers
not connected with such offering and purchases limited by such prices and
effected in response to order flow. Net purchases by a passive market maker on
each day are limited in amount to 30% of the passive market maker's average
daily trading volume in the Common Stock during the period of the two full
consecutive calendar months prior to the determination of the offering price in
connection with a sale pursuant to this
10
<PAGE> 13
Prospectus and must be discontinued when such limited is reached. Passive market
making may stabilize the market price of the Common Stock at a level above that
which might otherwise prevail and, if commenced, may be discontinued at any
time.
The Company may agree to indemnify each Selling Stockholder as an
underwriter under the Securities Act against certain liabilities, including
liabilities arising under the Securities Act. Each Selling Stockholder may
indemnify any broker-dealer that participates in transactions involving sales of
the Shares against certain liabilities, including liabilities arising under the
Securities Act.
LEGAL MATTERS
The validity of the shares of Common Stock offered hereby will be passed
upon for the Company by O'Connor, Cavanagh, Anderson, Killingsworth & Beshears,
a professional association, Phoenix, Arizona.
EXPERTS
The consolidated financial statements of the Company as of June 30, 1996
and 1997 and for each of the three years in the period ended June 30, 1997
incorporated by reference into this Prospectus and the Registration Statement of
which this Prospectus is a part, have been audited by Arthur Andersen LLP,
independent public accountants, as indicated in their reports with respect
thereto, and are incorporated by reference upon the authority of such firm as
experts in auditing and accounting in giving said reports.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Exchange
Act, and, in accordance therewith, files reports and other information with the
Commission. Reports, proxy and information statements filed by the Company with
the Commission pursuant to the informational requirements of the Exchange Act
may be inspected and copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
following Regional Offices of the Commission: New York Regional Office, 7 World
Trade Center, Suite 1300, New York, New York 10048; and Chicago Regional Office,
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60604.
Copies of such material may be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Room 1024, Judiciary Plaza, Washington,
D.C. 20549, at prescribed rates. The Common Stock of the Company is quoted on
The Nasdaq National Market. In addition, reports, proxy statements and other
information concerning the Company (symbol: RURL) can be inspected and copied at
the offices of the National Association of Securities Dealers, Inc. at 1735 K
Street, N.W. Washington, D.C. 20006. The Commission also maintains a Web site
that contains reports, proxy and information statements and other materials that
are filed through the Commission's Electronic Data Gathering, Analysis, and
Retrieval system. This Web site can be accessed at http://www.sec.gov.
ADDITIONAL INFORMATION
The Company has filed with the Commission a Registration Statement on Form
S-3 (the "Registration Statement") under the Securities Act with respect to the
shares of Common Stock offered hereby. This Prospectus omits certain information
contained in or incorporated by reference in the Registration Statement of which
this Prospectus is a part, and reference is made to the Registration Statement
and the exhibits and schedules thereto for further information with respect to
the Company and the Common Stock offered hereby. Statements contained herein
concerning the provisions of any documents are not necessarily complete, and in
each instance reference is made to the copy of such document filed as an exhibit
to the Registration Statement. Each such statement is qualified in its entirety
by such reference.
11
<PAGE> 14
NO DEALER, SALESPERSON, OR ANY OTHER PERSON HAS BEEN
AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN
THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION
OF AN OFFER TO BUY THE SECURITIES BY ANY PERSON IN ANY JURISDICTION IN WHICH
SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL OR TO ANY PERSON TO WHOM IT IS
UNLAWFUL. UNDER NO CIRCUMSTANCES SHALL THE DELIVERY OF THIS PROSPECTUS OR ANY
SALE MADE PURSUANT TO THIS PROSPECTUS CREATE ANY IMPLICATION THAT INFORMATION
CONTAINED IN THIS PROSPECTUS IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF
THIS PROSPECTUS.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
Incorporation of Certain
Documents by Reference............................. 2
Prospectus Summary................................... 3
Risk Factors......................................... 5
Selling Stockholders.................................. 9
Plan of Distribution................................. 10
Legal Matters........................................ 11
Experts.............................................. 11
Available Information................................ 11
Additional Information................................11
</TABLE>
143,505 SHARES
RURAL/METRO
CORPORATION
COMMON STOCK
PROSPECTUS
NOVEMBER ___, 1997
<PAGE> 15
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the estimated costs and expenses to be borne
by the Company in connection with the offering described in the Registration
Statement. All of the amounts in the following table (except the SEC fee) are
estimated.
<TABLE>
<CAPTION>
AMOUNT
------
<S> <C>
SEC Registration Fee.................................... $ 1,435
Legal Fees and Expenses................................. 6,000
Accounting Fees and Expenses............................ 5,000
Printing Expenses....................................... 1,000
Miscellaneous Expenses.................................. 565
--------
Total......................................... $ 14,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's amended and restated Bylaws require the Company to indemnify
its directors, officers, employees and agents to the fullest extent permitted by
the Delaware General Corporation Law, including those circumstances in which
indemnification would otherwise be discretionary, except that the Company will
not be obligated to indemnify any such person (i) with respect to proceedings,
claims or actions initiated or brought voluntarily by any such person a d not by
way of defense; (ii) for any amounts paid in settlement of an action indemnified
against by the Company without the proper written consent of the Company; or
(iii) in connection with any event in which the person did not act in good faith
and in a manner reasonably believed to be in, or not opposed to, the best
interests of the Company. In addition, the Company has entered or will enter
into Indemnity Agreements with each of its directors and officers providing for
indemnification of and advancement of expenses to the directors and officers to
the fullest extent permitted by law except (a) if and to the extent that payment
is made to the indemnitee under an insurance policy or otherwise; (b) if and to
the extent that a claim is decided adversely based on or attributable to the
indemnitee gaining any personal profit or advantage to which the indemnitee was
not legally entitled; (c) if and to the extent that the indemnifiable event
constituted or arose out of the indemnitee's willful misconduct or gross
negligence; or (d) if and to the extent that the proceeding is initiated by the
indemnitee against the Company or any of its officers or directors, unless the
Company has consented to or joined in the initiation of the proceeding. The
Delaware General Corporation Law contains an extensive indemnification provision
that permits a corporation to indemnify any person who is or was a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that he or she is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him or her in connection with such action, suit or proceeding if he
or she acted in good faith and in a manner he or she reasonably believed to be
in or not opposed to the best interests of the corporation, and, with respect to
any criminal action or proceeding, had no reasonable cause to believe his or her
conduct was unlawful.
The Company's Second Restated Certificate eliminates the personal liability
of the directors of the Company to the Company or its stockholders for monetary
damages for breach of their duty of care except to the extent that such
exemption from liability or limitation thereof is not permitted under the
Delaware General Corporation Law. The Delaware General Corporation Law prohibits
a corporation from eliminating or limiting 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 that involve
intentional misconduct or a knowing violation of law; (iii) for liability under
Section 174 of the Delaware General Corporation Law (relating to certain
unlawful dividends, stock purchases or stock redemptions); or (iv) for any
transaction from which the director derived any improper personal benefit.
II-1
<PAGE> 16
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION OF EXHIBIT
----------- ----------------------
<S> <C>
2 Plan and Agreement of Merger and Reorganization, dated as of April 26, 1993(1)
4 Specimen Certificate representing shares of Common Stock, par value $.01 per
share(1)
5 Opinion of O'Connor, Cavanagh, Anderson, Killingsworth & Beshears, P.A.
23.1 Consent of O'Connor, Cavanagh, Anderson, Killingsworth & Beshears, P.A. (to be
included in its Opinion filed as Exhibit 5)
23.2 Consent of Arthur Andersen LLP
24 Powers of Attorney of Directors and Executive Officers (included on the
Signature Page of this Registration Statement)
</TABLE>
- ----------
(1) Incorporated by reference to the Registration Statement on Form S-1 of the
Registrant (Registration No. 33-63448) filed May 27, 1993 and declared
effective July 15, 1993.
(b) Financial Statement Schedules
Incorporated by reference to the Annual Report on Form 10-K for the fiscal
year ended June 30, 1997, file No. 0-22056.
ITEM 17. UNDERTAKINGS
Insofar as indemnification for liabilities arising under the Securities Act
of 1933, as amended (the "Securities Act") may be permitted to directors,
officers and controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant 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 registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by 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.
The undersigned registrant hereby undertakes that:
(1) For the purpose of determining any liability under the Securities
Act, each post-effective amendment 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.
(2) For purposes of determining any liability under the Securities
Act, each filing of the registrant's annual report pursuant to Section 13(a)
or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act") (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the 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.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned registrant hereby undertakes to include any material
information with respect to the plan of distribution not previously disclosed in
the Registration Statement or any material change to such information in the
Registration Statement.
II-2
<PAGE> 17
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
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 Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Scottsdale, State of Arizona, on
November 4, 1997.
RURAL/METRO CORPORATION
By: /s/ James H. Bolin
-------------------------------------
James H. Bolin, President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints jointly and severally, Warren S. Rustand
and Mark E. Liebner, and each of them, as his true and lawful attorney-in-fact
and agents, with full power of substitution and resubstitution, for him and in
his name, place and stead, in any and all capacities, to sign any and all
amendments (including post-effective amendments) to this Registration Statement,
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
in connection therewith, as fully to all intents and purposes as he might or
could do in person, hereby ratifying, and confirming all that said
attorneys-in-fact and agents, or any of them, or their or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
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>
By: /s/ Warren S. Rustand Chairman of the Board of Directors November 4, 1997
----------------------------------------- and Chief Executive Officer
Warren S. Rustand (Principal Executive Officer)
By: /s/ James H. Bolin President and Director November 4, 1997
----------------------------------------- (Principal Executive Officer)
James H. Bolin
By: /s/ Robert T. Edwards Executive Vice President and Director November 4, 1997
----------------------------------------- (Principal Executive Officer)
Robert T. Edwards
By: /s/ Mark E. Liebner Senior Vice President, Chief Financial November 4, 1997
----------------------------------------- Officer and Treasurer
Mark E. Liebner (Principal Financial Officer)
By: /s/ Robert E. Ramsey Senior Vice President and Director November 4, 1997
-----------------------------------------
Robert E. Ramsey
By: /s/ Dean P. Hoffman Vice President, Financial Services November 4, 1997
----------------------------------------- (Principal Accounting Officer)
Dean P. Hoffman
By: /s/ Cor J. Clement Vice Chairman of the Board of Directors November 4, 1997
-----------------------------------------
Cor J. Clement
</TABLE>
II-3
<PAGE> 18
<TABLE>
<CAPTION>
<S> <C> <C>
By: /s/ Louis G. Jekel Director November 4, 1997
-----------------------------------------
Louis G. Jekel
By: Director __________, 1997
-----------------------------------------
William C. Turner
By: /s/ Henry G. Walker Director November 4, 1997
-----------------------------------------
Henry G. Walker
By: /s/ Louis A. Witzeman Director November 4, 1997
-----------------------------------------
Louis A. Witzeman
</TABLE>
II-4
<PAGE> 1
EXHIBIT 5
November 4, 1997
Rural/Metro Corporation
8401 East Indian School Road
Scottsdale, Arizona 85251
RE: REGISTRATION STATEMENT ON FORM S-3
Ladies and Gentlemen:
As special legal counsel to Rural/Metro Corporation, a Delaware
corporation (the "Company"), and the Selling Stockholders, as defined in the
Registration Statement, as defined below, we have assisted in the preparation
of the Company's Registration Statement on Form S-3 to be filed on or about
November 4, 1997 with the Securities and Exchange Commission (the "Registration
Statement"), in connection with the registration under the Securities Act of
1933, as amended (the "1933 Act"), of the shares of common stock, par value
$.01 per share, of the Company covered by the Registration Statement (the
"Shares"). The facts, as we understand them, are set forth in the Registration
Statement.
With respect to the opinion set forth below, we have examined originals,
certified copies, or copies otherwise identified to our satisfaction as being
true copies, only of the following:
A. The Second Restated Certificate of Incorporation of the Company, as
filed with the Secretary of State of the State of Delaware on January 18, 1995;
B. The Bylaws of the Company, as amended through the date hereof;
C. The Registration Statement;
D. The Resolutions of the Board of Directors of the Company dated May
14, 1933 relating to the organization of the Company; and
E. The Opinion of Jekel & Howard, dated March 14, 1994, with respect to
certain issues regarding the Company's wholly-owned subsidiary, Rural/Metro
Corporation, an Arizona corporation.
<PAGE> 2
Rural/Metro Corporation
November 4, 1997
Page 2
F. Plan and Agreement of Merger and Reorganization (the "Merger Plan"),
dated May 27, 1993, by and among the Company, Rural/Metro Corporation, an
Arizona corporation and R/M Acquisition, Inc., an Arizona corporation ("R/M");
G. Resolutions of each of the Company, Rural/Metro and R/M, each dated
May 14, 1993, approving the Merger Plan;
H. Articles of Merger, signed by the Company, Rural/Metro and R/M, filed
and approved by the Arizona Corporation Commission on May 27, 1993;
Subject to the assumptions that (i) the documents and signatures examined
by us are genuine and authentic and (ii) the persons executing the documents
examined by us have the legal capacity to execute such documents, and subject to
the further limitations and qualifications set forth below, it is our opinion
that, when (a) the Registration Statement as then amended shall have been
declared effective by the Commission, and (b) the Shares have been paid for and
sold by the Company and the Selling Shareholders as described in the
Registration Statement, the Shares will be validly issued, fully paid and
nonassessable.
We have assumed, with respect to the Shares that are to be sold by the
Selling Stockholders, (i) the payment by the Selling Stockholders (or the prior
holders thereof) of the full and sufficient consideration due from them to the
Company for such Shares and (ii) the Shares have been duly issued, executed, and
authenticated by the Company.
Please be advised that we are members of the State Bar of Arizona, and our
opinion is limited to the legality of matters under the laws of the State of
Arizona and the General Corporation Laws of the State of Delaware. Further, our
opinion is based solely upon existing laws, rules and regulations, and we
undertake no obligation to advise you of any changes that may be brought to our
attention after the date hereof.
We hereby expressly consent to any reference to our firm in the
Registration Statement, inclusion of this Opinion as an exhibit to the
Registration Statement, and to the filing of this Opinion with any other
appropriate governmental agency.
Very truly yours,
/s/ O'Connor, Cavanagh, Anderson,
Killingsworth & Beshears, P.A.
<PAGE> 1
[ARTHUR ANDERSEN LLP LETTERHEAD]
EX 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 report dated August 21, 1997
included in Rural/Metro Corporation's annual report on Form 10-K for the year
ended June 30, 1997 and to all references to our firm included in this
registration statement.
ARTHUR ANDERSEN LLP
Phoenix, Arizona
October 31, 1997.
