<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
(MARK ONE)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
FOR THE TRANSITION PERIOD FROM ________ TO ________
COMMISSION FILE NUMBER:
BUDGET 401(K)
AND PROFIT SHARING PLAN
125 BASIN STREET
SUITE 210
DAYTONA BEACH, FLORIDA 32114
(Full Title and Address of Plan)
BUDGET GROUP, INC.
125 BASIN STREET
SUITE 210
DAYTONA BEACH, FLORIDA 32114
(Name of Issuer of Securities held Pursuant to Plan
and Address of its Principal Executive Office)
<PAGE> 2
REQUIRED INFORMATION
The following financial statements for the Budget 401(k) and Profit Sharing
Plan are included herein:
1. An audited statement of net assets available for plan benefits as of
as of the end of each the latest two fiscal years of the plan.
2. An audited statement of changes in net assets available for plan
benefits for the latest fiscal year of the plan.
<PAGE> 3
INDEX TO EXHIBITS
Exhibit No. Description
23.1 Consent of Arthur Andersen LLP
<PAGE> 4
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
Budget Group, Inc., as administrator of the Budget 401(k) and Profit Sharing
Plan has caused this annual report to be signed on its behalf by the
undersigned thereunto duly authorized.
BUDGET 401(k) AND PROFIT SHARING PLAN
By: BUDGET GROUP, INC.
By: /s/ Thomas L. Kram
----------------------------------
Thomas L. Kram
Vice President and Controller
Date: July 13, 1998
---------------
<PAGE> 5
BUDGET 401(K) AND PROFIT SHARING PLAN
FINANCIAL STATEMENTS
AS OF DECEMBER 31, 1997 AND 1996,
TOGETHER WITH REPORT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
<PAGE> 6
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Board of Directors of
Budget Group, Inc.:
We have audited the accompanying statements of net assets available for plan
benefits of Budget 401(k) and Profit Sharing Plan (formerly known as Team Rental
Group, Inc. 401(k) Profit Sharing Plan) as of December 31, 1997 and 1996, and
the related statement of changes in net assets available for plan benefits for
the year ended December 31, 1997. These financial statements and the schedules
referred to below are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements and
schedules based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for plan benefits of the Plan as
of December 31, 1997 and 1996, and the changes in its net assets available for
plan benefits for the year ended December 31, 1997, in conformity with generally
accepted accounting principles.
Our audit was made for the purpose of forming an opinion on the basic financial
statements taken as a whole. The supplemental schedules of assets held for
investment (Schedule I) as of December 31, 1997, and reportable transactions
(Schedule II) for the year then ended, are presented for purposes of additional
analysis and are not a required part of the basic financial statements but are
supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. The fund information in the statements of net assets
available for plan benefits and the statement of changes in net assets available
for plan benefits is presented for purposes of additional analysis rather than
to present the net assets available for plan benefits and changes in net assets
available for plan benefits of each fund. The supplemental schedules and fund
information have been subjected to the auditing procedures applied in the audit
of the basic financial statements and, in our opinion, are fairly stated, in all
material respects, in relation to the basic financial statements taken as a
whole.
/s/ Arthur Andersen LLP
Orlando, Florida,
June 19, 1998
<PAGE> 7
BUDGET 401(K) AND PROFIT SHARING PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS, WITH FUND INFORMATION,
AS OF DECEMBER 31, 1997
<TABLE>
<CAPTION>
PARTICIPANT DIRECTED
-----------------------------------------------------------------------------
AIM AIM FRANKLIN TEMPLETON AMERICAN BUDGET GROUP,
CONSTELLATION MONEY MARKET EQUITY INCOME FOREIGN BOND INC. STOCK PARTICIPANT
FUND FUND FUND FUND FUND FUND LOANS TOTAL
-----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
CASH $ -- $ -- $ -- $ -- $ -- $ 48,820 $ -- $ 48,820
INVESTMENTS 793,620 300,750 729,600 420,127 254,849 1,091,590 20,435 3,610,971
COMPANY CONTRIBUTIONS RECEIVABLE -- -- -- -- -- 794,138 -- 794,138
PARTICIPANT CONTRIBUTIONS
RECEIVABLE 25,941 6,938 22,121 13,623 8,281 13,601 -- 90,505
------------------------------------------------------------------------------------------------
Total assets 819,561 307,688 751,721 433,750 263,130 1,948,149 20,435 4,544,434
LIABILITIES
EXCESS CONTRIBUTIONS PAYABLE 17,065 1,122 15,734 16,587 2,516 35,660 -- 88,684
------------------------------------------------------------------------------------------------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS $802,496 $306,566 $735,987 $417,163 $260,614 $1,912,489 $20,435 $4,455,750
================================================================================================
</TABLE>
The accompanying notes are an integral part of this statement.
<PAGE> 8
BUDGET 401(K) AND PROFIT SHARING PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS, WITH FUND INFORMATION,
AS OF DECEMBER 31, 1996
<TABLE>
<CAPTION>
Participant Directed
-----------------------------------------------------
AIM AIM Franklin Templeton
Constellation Money Equity Foreign
Fund Market Fund Income Fund Fund
ASSETS ------------- ----------- ----------- ---------
------
<S> <C> <C> <C> <C>
CASH $ - $ - $ - $ -
INVESTMENTS 472,594 203,105 407,514 272,486
COMPANY CONTRIBUTIONS RECEIVABLE - - - -
PARTICIPANT CONTRIBUTIONS RECEIVABLE 25,452 6,629 20,870 14,995
------------- ----------- ----------- ---------
Total assets 498,046 209,734 428,384 287,481
LIABILITIES
-----------
EXCESS CONTRIBUTIONS PAYABLE 20,313 4,760 15,198 23,259
------------- ----------- ----------- ---------
NET ASSETS AVAILABLE FOR PLAN BENEFITS $ 477,733 $ 204,974 $ 413,186 $ 264,222
============= =========== =========== =========
<CAPTION>
Participant Directed
---------------------
Budget
American Group, Inc. Participant
Bond Fund Stock Fund Loans Total
ASSETS --------- ----------- ----------- -----------
------
<S> <C> <C> <C> <C>
CASH $ - $ 30,416 $ - $ 30,416
INVESTMENTS 158,287 309,091 10,892 1,833,969
COMPANY CONTRIBUTIONS RECEIVABLE - 12,821 - 12,821
EMPLOYEE CONTRIBUTIONS RECEIVABLE 7,705 13,126 - 88,777
--------- ---------- ----------- -----------
Total assets 165,992 365,454 10,892 1,965,983
LIABILITIES
-----------
EXCESS CONTRIBUTIONS PAYABLE 3,489 42,626 - 109,645
--------- ---------- ----------- -----------
NET ASSETS AVAILABLE FOR PLAN BENEFITS $ 162,503 $ 322,828 $ 10,892 $ 1,856,338
========= ========== =========== ===========
</TABLE>
The accompanying notes are an integral part of this statement.
<PAGE> 9
BUDGET 401(K) AND PROFIT SHARING PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS,
WITH FUND INFORMATION,
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
PARTICIPANT DIRECTED
-----------------------------------------------------------------------------
AIM AIM FRANKLIN TEMPLETON AMERICAN BUDGET GROUP,
CONSTELLATION MONEY MARKET EQUITY INCOME FOREIGN BOND INC. STOCK PARTICIPANT
FUND FUND FUND FUND FUND FUND LOANS TOTAL
------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ADDITIONS:
Contributions-
Company $ -- $ -- $ -- $ -- $ -- $1,020,154 $ -- $1,020,154
Participant 328,725 101,243 275,707 196,541 112,835 189,900 -- 1,204,951
-----------------------------------------------------------------------------------------------
Total contributions 328,725 101,243 275,707 196,541 112,835 1,210,054 -- 2,225,105
-----------------------------------------------------------------------------------------------
Investment income-
Interest and dividends -- 14,884 18,926 15,491 13,956 319 1,354 64,930
Net appreciation 71,984 -- 112,243 6,307 4,410 411,833 -- 606,777
-----------------------------------------------------------------------------------------------
Total investment income 71,984 14,884 131,169 21,798 18,366 412,152 1,354 671,707
-----------------------------------------------------------------------------------------------
Total additions 400,709 116,127 406,876 218,339 131,201 1,622,206 1,354 2,896,812
-----------------------------------------------------------------------------------------------
TRANSFERS TO (FROM) OTHER INVESTMENT
OPTIONS, including participant
loan transactions 7,929 3,271 (24,431) (32,271) (9,435) 44,483 10,454 --
-----------------------------------------------------------------------------------------------
DEDUCTIONS:
Benefit payments (83,875) (17,806) (59,644) (33,127) (23,655) (77,028) (2,265) (297,400)
-----------------------------------------------------------------------------------------------
NET INCREASE 324,763 101,592 322,801 152,941 98,111 1,589,661 9,543 2,599,412
NET ASSETS AVAILABLE FOR PLAN
BENEFITS, beginning of year 477,733 204,974 413,186 264,222 162,503 322,828 10,892 1,856,338
-----------------------------------------------------------------------------------------------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS, end of year $802,496 $ 306,566 $735,987 $417,163 $260,614 $1,912,489 $20,435 $4,455,750
===============================================================================================
</TABLE>
The accompanying notes are an integral part of this statement.
<PAGE> 10
BUDGET 401(K) AND PROFIT SHARING PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1997 and 1996
1. PLAN DESCRIPTION:
The following description of the Budget 401(k) and Profit Sharing Plan (the
Plan) provides only general information. Participants should refer to the plan
agreement for a more complete description of the Plan's provisions.
General
The Plan is a defined contribution plan covering all employees of Budget Group,
Inc. (the Company), who have one year of service and are age 21 or older. The
Budget 401(k) and Profit Sharing Plan was established effective January 1, 1996.
The Plan is subject to the provisions of the Employee Retirement Income Security
Act of 1974 (ERISA).
In July 1997, the Company acquired Premier Car Rental, Inc. (Premier). Effective
April 1, 1996, all Premier employees who were eligible to participate in the
Chrysler Corporation Salaried Employees' Savings Plan as of March 31, 1996, were
eligible to participate in the Plan.
Effective September 11, 1997, the Company amended the Plan by changing the name
from the Team Rental Group, Inc. 401(k) Profit Sharing Plan to the Budget
401(k) and Profit Sharing Plan.
Contributions
Each year, participants may contribute up to 15 percent of pretax annual
compensation, as defined in the Plan, subject to certain limitations under the
Internal Revenue Code (IRC). Participants may rollover amounts from other
qualified defined benefit or contribution plans. The Company contributes 25
percent of the first 4 percent of compensation that a participant contributes to
the Plan. Additional amounts may be contributed at the option of the Company's
Board of Directors. The discretionary contribution is allocated based on the
employee's compensation under the permitted disparity limit, in accordance with
IRC section 401(l). All Company contributions are invested in Budget Group, Inc.
stock.
<PAGE> 11
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Participant Accounts
Each participant's account is credited with the participant's contribution, the
Company's contributions and plan earnings. Plan earnings are allocated based on
the proportion of each participant's account balance to the total of all
participant account balances.
Vesting
Participants have at all times a fully vested, nonforfeitable interest in each
of their accounts.
Benefit Payments
On termination of service due to retirement, death, disability or termination, a
participant may elect to receive either a lump-sum amount equal to the value of
the participant's account or in installments over a period of time, as defined
in the Plan. A participant who was a participant in the BRAC-OP Co. 401(k)
Salary Savings Plan (BRAC-OP Plan) as of May 20, 1996, and whose accrued benefit
under that plan was merged with the Plan may elect to receive benefits in the
form of a joint and survivor annuity.
Participant Loans
Participants may borrow from their accounts a minimum of $1,000, up to a maximum
equal to the lesser of $50,000 or 50 percent of their account balance. Interest
rates on participant loans are determined based upon a reasonable rate of
interest, approximating prevailing interest rates on bank loans of similar
length of time and repayment terms. A loan is repayable over a period not
extending beyond five years, unless such loan is used to acquire a principal
residence of the participant. Interest rates range from 8.75 percent to 11
percent.
Principal and interest are paid ratably through payroll deductions.
Plan Termination
Although it has not expressed any intent to do so, the Company has the right,
under the Plan, to discontinue its contributions at any time and to terminate
the Plan subject to the provisions of ERISA.
Investment Options
Participants can choose among six investment options: AIM Constellation Fund,
AIM Money Market Fund, Franklin Equity Income Fund, Templeton Foreign Fund,
American Bond Fund and Budget Group, Inc. Stock Fund. Participants may change
their elections on a daily basis by using a telephone access system, except for
the Budget Group, Inc. Stock Fund which can only be changed annually on January
1.
<PAGE> 12
- 3 -
2. SIGNIFICANT ACCOUNTING POLICIES:
Basis of Accounting
The accounts of the Plan are maintained on the accrual basis of accounting in
accordance with generally accepted accounting principles.
Investment Valuation and Income Recognition
Securities owned are reflected in the accounts of the Plan at quoted market
value. Changes in quoted market value of securities owned are included in net
appreciation in the accompanying statement of changes in net assets available
for plan benefits. The fair market value of the Budget Group, Inc. Stock at
December 31, 1997 and 1996 was $1,090,910 and $308,895, respectively.
Administrative Expenses
All administrative expenses are paid by the Company.
Benefit Payments
Benefits are recorded when paid.
Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of net assets available for plan benefits and the
changes in net assets available for plan benefits during the reporting period.
Actual results could differ from those estimates.
<PAGE> 13
- 4 -
3. INCOME TAX STATUS:
The Internal Revenue Service (IRS) has determined and informed the Company by a
letter dated June 2, 1998, that the Plan and related trust are designed in
accordance with applicable sections of the IRC.
4. RELATED-PARTY TRANSACTIONS:
The McDonald Money Market Fund is managed by the investment advisor, McDonald &
Company Securities, Inc., a party-in-interest.
5. SUBSEQUENT EVENT:
As of February 28, 1998, the Plan was frozen with the intention to merge with
the Budget Rent A Car Corporation SavingsPlus Plan in 1998.
6. SUPPLEMENTAL SCHEDULES:
The accompanying schedules of assets held for investment and reportable
transactions are included as required schedules under ERISA.
<PAGE> 14
SCHEDULE I
BUDGET 401(K) AND PROFIT SHARING PLAN
SCHEDULE OF ASSETS HELD FOR INVESTMENT
AS OF DECEMBER 31, 1997
<TABLE>
<CAPTION>
Market
Cost Value
---------- ----------
<S> <C> <C>
COMMON STOCK FUND
Budget Group, Inc. Stock $ 706,011 $1,090,910
McDonald Money Market Fund* 68 680
----------
1,091,590
MUTUAL FUNDS:
AIM Constellation Fund 787,750 793,620
Franklin Equity Income Fund 637,770 729,600
Templeton Foreign Fund 439,626 420,127
American Bond Fund 249,191 254,849
----------
Total mutual funds 2,198,196
----------
MONEY MARKET FUNDS:
AIM Money Market Fund 300,750 300,750
----------
Total money market funds 300,750
----------
PARTICIPANT LOANS (interest rates ranging from 8.75 percent to
11 percent, maximum of five years to maturity, except for loans used
to acquire the principal residence of the participant) 20,435 20,435
----------
Total assets held for investment $3,610,971
==========
</TABLE>
*Managed by the investment advisor, a party-in-interest.
The preceding notes are an integral part of this schedule.
<PAGE> 15
SCHEDULE II
BUDGET 401(K) AND PROFIT SHARING PLAN
SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
Detail of
Acquisitions Detail of Dispositions
------------ --------------------------------
A series of transactions in excess of 5% of beginning net
assets available for plan benefits Cost Cost Proceeds Gain
- --------------------------------------------------------- ------------ -------- -------- --------
<S> <C> <C> <C> <C>
COMMON STOCK FUND:
Budget Group, Inc. Stock $473,929 $ 74,593 $103,747 $ 29,154
MUTUAL FUNDS:
AIM Constellation Fund 365,387 55,204 116,345 61,141
Franklin Equity Income Fund 343,870 99,152 134,027 34,875
Templeton Foreign Fund 263,360 86,253 122,026 35,773
American Bond Fund 129,854 36,471 37,702 1,231
MONEY MARKET FUNDS:
AIM Money Market Fund 140,472 42,827 42,827 --
McDonald Money Market Fund* 460,970 460,486 460,486 --
</TABLE>
*Managed by the investment advisor, a party-in-interest.
The preceding notes are an integral part of this schedule.
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
As independent certified public accountant, we hereby consent to the
incorporation by reference of our report included in this Form 11-K into Budget
Group, Inc.'s (formerly known as Team Rental Group, Inc.) previously filed
Registration Statement File No. 333-49819.
/s/ Arthur Andersen LLP
July 10, 1998,
Orlando, Florida
