<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement (Revised)
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
BUDGET GROUP, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
April 2, 1999
Dear Stockholder:
We cordially invite you to attend our 1999 Annual Meeting of Stockholders
on Wednesday, April 28, 1999 beginning at 10:00 a.m. local time. The meeting
will be held at the Hilton Daytona Beach Ocean Front Resort, 2637 S. Atlantic
Avenue, River Room, Daytona Beach, Florida (904) 767-7350.
The attached Notice of Annual Meeting and Proxy Statement fully describe
the formal business to be transacted at the annual meeting, including (1) the
election of two directors, (2) the amendment of our Restated Certificate of
Incorporation to fix the size of our Board of Directors at not less than seven
(7) nor more than twelve (12) directors and (3) the ratification of the Board of
Directors' appointment of Arthur Andersen LLP as our independent accountants for
the 1999 fiscal year.
As you review the Proxy Statement, you will notice that it has been
simplified and is easier to understand. The Securities and Exchange Commission
is encouraging companies to adopt "plain english" to facilitate better
communication between companies and their stockholders. We are committed to
communicating with you clearly and effectively.
It is important that your shares be represented at the annual meeting.
Whether or not you plan to attend, please complete, sign and date the enclosed
proxy card and return it in the enclosed postage prepaid envelope. If you attend
the annual meeting and vote in person, your proxy card will not be used. The
prompt return of your proxy card will save the expense involved in further
communication.
Your Board of Directors and I look forward to seeing you at the annual
meeting.
Very truly yours,
/s/ SANFORD MILLER
SANFORD MILLER
Chairman of the Board and Chief
Executive Officer
<PAGE> 3
BUDGET GROUP, INC.
---------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD APRIL 28, 1999
---------------------
TO OUR STOCKHOLDERS:
The 1999 Annual Meeting of Stockholders of Budget Group, Inc. will be held
at the Hilton Daytona Beach Ocean Front Resort, 2637 S. Atlantic Avenue, River
Room, Daytona Beach, Florida, (904) 767-7350 on Wednesday, April 28, 1999,
beginning at 10:00 a.m. local time. At the meeting, stockholders will act on the
following matters:
(1) Election of two directors, each for a term of three years;
(2) Amendment of Budget's Restated Certificate of Incorporation to fix
the size of Budget's Board of Directors at not less than seven (7) nor more
than twelve (12) directors;
(3) Ratification of the appointment of Arthur Andersen LLP as Budget's
independent accountants for fiscal 1999; and
(4) Any other matters that properly come before the meeting.
Stockholders of record at the close of business on March 15, 1999 are
entitled to attend and vote at the meeting or any postponement or adjournment.
By order of the Board of Directors,
/s/ SANFORD MILLER
SANFORD MILLER
Chairman of the Board and Chief
Executive Officer
April 2, 1999
Daytona Beach, Florida
WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING, PLEASE SIGN, DATE AND
MAIL THE ENCLOSED PROXY CARD PROMPTLY. IF YOU ATTEND THE ANNUAL MEETING AND VOTE
IN PERSON, THE PROXY CARD WILL NOT BE USED. IF THE PROXY CARD IS MAILED IN THE
UNITED STATES IN THE ENCLOSED ENVELOPE, NO POSTAGE IS REQUIRED. THE PROMPT
RETURN OF YOUR PROXY CARD WILL SAVE US THE EXPENSE INVOLVED IN FURTHER
COMMUNICATION.
<PAGE> 4
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
ABOUT THE MEETING........................................... 1
Why am I receiving this Proxy Statement and proxy card?... 1
What is the purpose of the annual meeting?................ 1
Who is entitled to vote?.................................. 1
How many votes does each share of common stock entitle its
holder to cast?........................................ 1
Who can attend the meeting?............................... 2
How many votes do you need to hold the meeting?........... 2
How do I vote?............................................ 2
Can I change my vote after I return my proxy card?........ 2
Will my shares be voted if I do not sign and return my
proxy card?............................................ 2
What are the Board's recommendations?..................... 3
What vote is required to approve each item?............... 3
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS............. 4
ITEM 1 -- ELECTION OF DIRECTORS............................. 7
Directors Standing for Election........................... 7
Who are the nominees this year?........................ 7
What if a nominee is unwilling to serve?............... 7
What is the background of this year's nominees?........ 7
Directors Continuing in Office............................ 8
What is the background of the directors not standing for
election this year?.................................... 8
How are directors compensated?............................ 9
How often did the Board meet during 1998?................. 9
What committees has the Board established?................ 9
Executive Officers........................................ 10
Certain Relationships and Related Transactions............ 11
Executive Compensation.................................... 14
Compensation Committee Report on Executive
Compensation.......................................... 14
Compensation Committee Interlocks and Insider
Participation......................................... 15
Executive Severance Agreements......................... 15
Executive Compensation Summary Table................... 16
Option Grants During 1998 and Year-End Option Values... 17
Aggregate Option Exercises During 1998 and Year-End
Option Values......................................... 17
Performance Graph...................................... 18
ITEM 2 -- AMENDMENT OF CERTIFICATE OF INCORPORATION
REGARDING NUMBER OF DIRECTORS..................... 18
What is the Proposed Amendment?........................... 18
What are the reasons for the Proposed Amendment?.......... 19
ITEM 3 -- RATIFICATION OF APPOINTMENT OF INDEPENDENT
ACCOUNTANTS....................................... 19
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE..... 20
OTHER MATTERS............................................... 20
ADDITIONAL INFORMATION...................................... 20
</TABLE>
<PAGE> 5
BUDGET GROUP, INC.
125 BASIN STREET
SUITE 210
DAYTONA BEACH, FLORIDA 32114
---------------------
PROXY STATEMENT
---------------------
This Proxy Statement contains information regarding the 1999 annual meeting
of stockholders of Budget Group, Inc. ("Budget"). The meeting will be held on
Wednesday, April 28, 1999, beginning at 10:00 a.m., at the Hilton Daytona Beach
Ocean Front Resort, 2637 S. Atlantic Avenue, River Room, Daytona Beach, Florida,
(904) 767-7350. The proxy card enclosed with this Proxy Statement is being
solicited by the Budget Board of Directors. Voting material for the meeting,
which includes this Proxy Statement, the enclosed proxy card and our 1998 Annual
Report, will be mailed to our stockholders on or about April 2, 1999.
ABOUT THE MEETING
WHY AM I RECEIVING THIS PROXY STATEMENT AND PROXY CARD?
You are receiving a Proxy Statement and proxy card because you own shares
of Class A or Class B common stock in Budget. This Proxy Statement describes
issues on which we would like you, as a stockholder, to vote. It also gives you
information on these issues so you can make an informed decision.
When you sign the proxy card, you appoint Sanford Miller and Jeffrey D.
Congdon as your representatives at the meeting. Mr. Miller and Mr. Congdon will
vote your shares, as you have instructed them on the proxy card, at the meeting.
This way, your shares will be voted whether or not you attend the annual
meeting. Even if you plan to attend the meeting, it is a good idea to complete,
sign and return your proxy card in advance of the meeting just in case your
plans change.
If an issue comes up for vote at the meeting that is not on the proxy card,
Mr. Miller and Mr. Congdon will vote your shares, under your proxy, in
accordance with their best judgment.
WHAT IS THE PURPOSE OF THE ANNUAL MEETING?
At the annual meeting, stockholders will act on the matters outlined in the
accompanying Notice of Meeting. These matters include the election of directors,
the amendment of our Restated Certificate of Incorporation to fix the number of
directors that comprises the Board of Directors and ratification of the
appointment of our independent accountants. In addition, management will report
on the performance of Budget during 1998 and respond to questions from
stockholders.
WHO IS ENTITLED TO VOTE?
Only stockholders of record at the close of business on the record date,
March 15, 1999, are entitled to receive notice of the annual meeting and to vote
the shares of common stock that they held on that date at the meeting, or any
postponement or adjournment of the meeting. At the close of business on the
record date, 33,965,021 shares of Budget's Class A common stock and 1,936,600
shares of Class B common stock were outstanding and are entitled to vote at the
annual meeting.
HOW MANY VOTES DOES EACH SHARE OF COMMON STOCK ENTITLE ITS HOLDER TO CAST?
Holders of Class A common stock are entitled to one vote per share, and
holders of Class B common stock are entitled to ten votes per share on each
matter to be voted on at the meeting. No cumulative
<PAGE> 6
voting rights are authorized and dissenter's rights of appraisal under Delaware
law or the rules of the New York Stock Exchange do not apply to the matters
being proposed.
WHO CAN ATTEND THE MEETING?
All stockholders as of the record date, or their duly appointed proxies,
may attend the meeting, and may be accompanied by guests. Registration and
seating will begin at 9:00 a.m. Each stockholder may be asked to present valid
picture identification, such as a driver's license or passport. Cameras,
recording devices and other electronic devices will not be permitted at the
meeting.
Please note that if you hold your shares in "street name" (that is, through
a broker or other nominee), you must bring a copy of a brokerage statement
reflecting your stock ownership as of the record date and check in at the
registration desk at the meeting.
HOW MANY VOTES DO YOU NEED TO HOLD THE MEETING?
Our Bylaws provide that the presence in person or by proxy of the holders
of a majority of the combined voting power of all shares of common stock issued
and outstanding on the record date and entitled to vote at the meeting is
required to hold the meeting and conduct business. This is called a "quorum."
Proxy cards received but marked "ABSTAIN" or as "broker non-votes" will be
included in the calculation of the number of shares considered to be present at
the meeting.
As of March 15, 1999, 33,965,021 shares of our Class A common stock and
1,936,600 shares of our Class B common stock were issued and outstanding.
HOW DO I VOTE?
YOU MAY VOTE BY MAIL. You do this by signing your proxy card and mailing
it in the enclosed, prepaid and addressed envelope. If you mark your voting
instructions on the proxy card, your shares will be voted as you instruct. If
you return a signed card but do not provide voting instructions, your shares
will be voted for the two named nominees, for the amendment to our Restated
Certificate of Incorporation and for the ratification of the appointment of the
independent accountants.
YOU MAY VOTE IN PERSON AT THE MEETING. Written ballots will be passed out
to anyone who wants to vote at the meeting. If you hold your shares in "street
name" (through a broker or other nominee), you must request a legal proxy from
your stockbroker to vote at the meeting.
CAN I CHANGE MY VOTE AFTER I RETURN MY PROXY CARD?
Yes. Even after you have submitted your proxy card, you may change your
vote at any time before the proxy is exercised by filing with the Secretary of
Budget either a notice of revocation or an executed proxy card with a later
date. The powers of the proxy holders will be suspended if you attend the
meeting in person AND SO REQUEST. Attendance at the meeting will not by itself
revoke a previously granted proxy.
WILL MY SHARES BE VOTED IF I DO NOT SIGN AND RETURN MY PROXY CARD?
If your shares are held in street name, your brokerage firm may vote your
shares under certain circumstances. These circumstances include certain
"routine" matters, such as the election of directors. Therefore, if you do not
vote your proxy, your brokerage firm may either vote your shares on routine
matters, or leave your shares unvoted. When a brokerage firm votes its
customers' unvoted shares on routine matters, these shares are counted for
purposes of establishing a quorum to conduct business at the meeting.
A brokerage firm cannot vote customers' shares on non-routine matters.
Therefore, if your shares are held in street name and you do not vote your
proxy, your shares will not be voted on non-routine matters and will not be
counted in determining the number of shares necessary for approval. Shares
represented by such "broker non-votes" will, however, be counted in determining
whether there is a quorum.
2
<PAGE> 7
WHAT ARE THE BOARD'S RECOMMENDATIONS?
Unless you give other instructions on your proxy card, the persons named as
proxy holders on the proxy card will vote in accordance with the recommendations
of the Board of Directors. The Board's recommendation is set forth together with
the description of each item in this proxy statement. In summary, the Board
recommends a vote:
- for election of the nominated slate of directors (see page 7);
- for amending our Restated Certificate of Incorporation to provide that
our Board of Directors shall consist of not less than seven (7) nor more
than twelve (12) directors and the Board shall have the exclusive right
to fix the number of directors (see page 18); and
- for ratification of the appointment of Arthur Andersen LLP as Budget's
independent accountants (see page 19)
With respect to any other matter that properly comes before the meeting,
the proxy holders will vote as recommended by the Board of Directors or, if no
recommendation is given, in their own discretion.
WHAT VOTE IS REQUIRED TO APPROVE EACH ITEM?
ELECTION OF DIRECTORS. The affirmative vote of a plurality of the votes
cast at the meeting is required for the election of directors. "Plurality" means
that the individuals who receive the largest number of votes cast are elected as
directors. Consequently, shares not voted, whether by marking "ABSTAIN" on your
proxy card, by broker non-vote (which is described above) or otherwise, have no
impact on the election of directors. Unless a properly executed proxy card is
marked "WITHHOLD AUTHORITY," the proxy given will be voted "FOR" the two
nominees for director.
AMENDMENT TO THE RESTATED CERTIFICATE OF INCORPORATION. The affirmative
vote of the holders of a majority of the combined voting power of the shares of
Class A common stock and Class B common stock outstanding on the record date is
required to approve the amendment to our Restated Certificate of Incorporation.
A properly executed proxy card marked "ABSTAIN" with respect to the amendment
will not be voted. Accordingly, an abstention will have the effect of a vote
"AGAINST" the proposal to amend the Restated Certificate of Incorporation.
RATIFICATION OF THE APPOINTMENT OF THE AUDITORS. The affirmative vote of
the majority of the combined voting power of shares of Class A common stock and
Class B common stock represented in person or by proxy and entitled to vote on
the item is required for approval. A properly executed proxy card marked
"ABSTAIN" with respect to the ratification of the appointment of the auditors
will not be voted. Accordingly, an abstention will have the effect of a vote
"AGAINST" the proposal.
3
<PAGE> 8
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
Unless otherwise indicated, the following table sets forth certain
information, as of March 15, 1999, with respect to the beneficial ownership of
our common stock by (1) each person known by us to beneficially own more than 5%
of either class of common stock, (2) each director or nominee for director, (3)
our executive officers and (4) all directors and executive officers as a group.
As of March 15, 1999, we had outstanding 33,965,021 shares of Class A common
stock and 1,936,600 shares of Class B common stock. This table also gives effect
to shares that may be acquired pursuant to options as described in the footnotes
below.
<TABLE>
<CAPTION>
CLASS A COMMON STOCK CLASS B COMMON STOCK PERCENT OF
------------------------------- ------------------------------- TOTAL VOTING
NUMBER OF PERCENT OF NUMBER OF PERCENT OF POWER OF COMMON
CLASS A SHARES CLASS A SHARES CLASS B SHARES CLASS B SHARES STOCK
BENEFICIALLY BENEFICIALLY BENEFICIALLY BENEFICIALLY BENEFICIALLY
DIRECTORS AND EXECUTIVE OFFICERS OWNED(A) OWNED OWNED(A) OWNED OWNED
- -------------------------------- -------------- -------------- -------------- -------------- ---------------
<S> <C> <C> <C> <C> <C>
Sanford Miller................. 1,122,808(b) 3.2% 1,024,550(b) 45.4% 19.0%
Jeffrey D. Congdon............. 706,385(c) 2.0 614,150(c) 27.3 10.5
Robert L. Aprati............... 85,440(d) * -- -- *
Michael B. Clauer.............. 24,655(e) * -- -- *
Scott R. White................. 78,011(d) * -- -- *
Mark R. Sotir.................. 20,162(f) * -- -- *
Ronald D. Agronin.............. 37,400(g) * -- -- *
James F. Calvano............... 42,500(h) * -- -- *
Martin P. Gregor............... 43,905(g) * -- -- *
F. Perkins Hixon............... 15,000(i) * -- -- *
John P. Kennedy................ 655,449(j) 1.9 614,150(j) 27.3 10.4
Jeffrey R. Mirkin.............. 202,383(k) * -- -- *
Dr. Stephen L. Weber........... 40,600(h) * -- -- *
All directors and executive
officers as a group (13
persons)..................... 3,009,332(l) 8.9 2,252,850(m) 100.0% 41.2%
5% STOCKHOLDERS
The Equitable Companies
Incorporated................. 3,972,100(n) 11.7 -- -- 7.4
Baron Capital Group, Inc....... 3,224,450(o) 9.5 -- -- 6.0
Oppenheimer Management
Company...................... 2,216,004(p) 6.5 -- -- 4.2
Capital Research & Management
Company...................... 2,201,110(q) 6.5 -- -- 4.1
Lazard Freres & Co. LLC........ 1,884,800(r) 5.5 -- -- 3.5
Questor Partners Fund, L.P..... 1,779,892(s) 5.2 -- -- 3.3
</TABLE>
- ------------------------------
* Less than 1%
(a) In determining the number and percent of shares beneficially owned by each
person, shares that may be acquired by such person pursuant to options,
convertible notes or convertible preferred stock exercisable or convertible
within 60 days of the date hereof are deemed outstanding for purposes of
determining the total number of outstanding shares for such person and are
not deemed outstanding for such purpose for all other stockholders. To the
best of our knowledge, except as otherwise indicated, beneficial ownership
includes sole voting and dispositive power with respect to all shares.
(b) Includes (i) 905,800 shares of Class A common stock issuable upon
conversion of Class B common stock, (ii) 118,750 shares of Class A common
stock issuable upon conversion of Class B common stock issuable upon
exercise of options granted under our 1994 Incentive Stock Option Plan (the
"1994 Employee Option Plan"), (iii) 8,000 shares of Class A common stock
owned by Mr. Miller's minor children but with respect to which Mr. Miller
has sole voting and dispositive power, and (iv) 32,683 shares of Class A
common stock held by the Budget Group, Inc. Savings Plus Plan ("Savings
Plus Plan") of which Mr. Miller, as a trustee of the Savings Plus Plan,
shares voting and dispositive power. Mr. Miller's address is 125 Basin
Street, Suite 210, Daytona Beach, Florida 32114.
4
<PAGE> 9
(c) Includes (i) 515,400 shares of Class A common stock issuable upon
conversion of Class B common stock, (ii) 98,750 shares of Class A common
stock issuable upon conversion of Class B common Stock issuable upon
exercise of options granted under the 1994 Employee Option Plan, (iii)
16,669 shares of Class A common stock owned by the Congdon Family
Foundation, Inc. (the "Foundation"), of which Mr. Congdon and his wife
share voting and dispositive power as the President and Treasurer and Vice
President and Secretary, respectively, of the Foundation and (iv) 32,683
shares of Class A common stock held by the Savings Plus Plan of which Mr.
Congdon, as a trustee of the Savings Plus Plan, shares voting and
dispositive power. Mr. Congdon's address is Woodland Corporate Center One,
7602 Woodland Drive, Suite 150, Indianapolis, Indiana 46278-2706.
(d) Includes 62,500 shares of Class A common stock issuable upon exercise of
options granted under the 1994 Employee Option Plan.
(e) Includes 8,750 shares of Class A common stock issuable upon exercise of
options granted under the 1994 Employee Option Plan.
(f) Includes 20,375 shares of Class A common stock issuable upon exercise of
options granted under 1994 Employee Option Plan.
(g) Includes 32,500 shares of Class A common stock issuable upon exercise of
options granted under the 1994 Directors' Plan.
(h) Includes 37,500 shares of Class A common stock issuable upon exercise of
options granted under the 1994 Directors' Plan.
(i) Includes 15,000 shares of Class A common stock issuable upon exercise of
options granted under the 1994 Directors' Plan.
(j) Includes (i) 515,400 shares of Class A common stock issuable upon
conversion of Class B common stock, (ii) 98,750 shares of Class A common
stock issuable upon conversion of Class B common stock issuable upon
exercise of options granted under the 1994 Employee Option Plan, and (iii)
32,683 shares of Class A common stock held by the Savings Plus Plan of
which Mr. Kennedy, as a trustee of the Savings Plus Plan, shares voting and
dispositive power. Mr. Kennedy's address is 131 Church Street, Suite 210,
Burlington, Vermont 05401.
(k) Includes (i) 3,515 shares of Class A common stock beneficially owned by a
family corporation, of which Mr. Mirkin has sole voting and dispositive
power as President, (ii) 90,000 shares of Class A common stock beneficially
held by a charitable remainder trust of which Mr. Mirkin has sole voting
and dispositive power as the trustee and (iii) 37,500 shares of Class A
common stock issuable upon exercise of options granted under our 1994
Directors' Plan.
(l) Includes (i) 1,936,600 shares of Class A common stock issuable upon
conversion of Class B common stock and (ii) 240,000 shares of Class A
common stock issuable upon conversion of Class B common stock issuable upon
exercise of options granted under the 1994 Employee Option Plan.
(m) Includes 316,250 shares of Class B common stock issuable upon exercise of
options granted under the 1994 Employee Stock Option Plan
(n) Represents shares of Class A common stock owned by subsidiaries of The
Equitable Companies Incorporated ("Equitable") as follows: (i) 620,500
shares of Class A common stock held by The Equitable Life Assurance Society
of the United States; and (ii) 3,351,600 shares of Class A common stock
held by Alliance Capital Management L.P. The Equitable's address is 1290
Avenue of the Americas, New York, New York 10104. This information is
included in reliance upon a Schedule 13G filed by Equitable with the
Commission on April 10, 1998.
(o) Represents shares of Class A common stock beneficially owned by Ronald
Baron and by the following entities controlled by Mr. Baron: Baron Capital
Group, Inc., BAMCO, Inc., Baron Asset Fund and Baron Capital Management,
Inc. (the "Baron Affiliates"). The address for the Baron Affiliates is 767
Fifth Avenue, 24th Floor, New York, New York 10153. This information is
included in reliance upon a Schedule 13G filed by the Baron Affiliates with
the Commission on January 8, 1999.
(p) Includes shares of Class A common stock that would be received upon
conversion of beneficial ownership of convertible preferred shares. The
address of Oppenheimer Management Company ("Oppenheimer") is Two World
Trade Center, 34th Floor, New York, New York 10048-0203. This
5
<PAGE> 10
information is included in reliance upon a Schedule 13G filed by
Oppenheimer with the Commission on February 12, 1999.
(q) Includes 1,366,110 shares of Class A common stock that would result from
conversion of 900,000 convertible preferred shares. The address of Capital
Research & Management Company ("Capital Research") is 333 South Hope
Street, Los Angeles, California 90071. This information is included in
reliance upon a Schedule 13G filed by Capital Research with the Commission
on February 11, 1999.
(r) The address of Lazard Freres & Co. LLC ("Lazard") is 30 Rockefeller Plaza,
New York, New York 10020. This information is included in reliance upon a
Schedule 13G filed by Lazard with the Commission on February 10, 1999.
(s) Includes 119,143 shares of Class A common stock owned by Questor
Side-By-Side Partners, L.P., an affiliate of Questor Partners Fund, L.P.
("Questor"). Questor's address is 103 Springer Building, 3411 Silverside,
Wilmington, Delaware 19810. This information is included in reliance upon a
Schedule 13G filed by Questor Partners Fund, L.P. and Questor Side-By-Side
Partners, L.P. on June 29, 1998.
6
<PAGE> 11
ELECTION OF DIRECTORS (ITEM 1)
DIRECTORS STANDING FOR ELECTION
The Board of Directors currently consists of nine (9) directors divided
into three classes, having three-year terms that expire in successive years.
WHO ARE THE NOMINEES THIS YEAR?
The current term of office of Messrs. Agronin, Kennedy and Mirkin, who are
directors in Class III, expires at the 1999 annual meeting. The Board proposes
that Mr. Agronin and Mr. Kennedy be re-elected to Class III for a new term of
three years and until their successors are duly elected and qualified. The
Nominating Committee did not nominate Mr. Mirkin to stand for re-election to the
Board of Directors. The Nominating Committee has elected not to nominate a third
director to fill the Class III vacancy at the annual meeting, and the Board has
fixed the size of the Board at eight (8) effective as of the annual meeting. The
Board, however, intends after the meeting to seek a qualified candidate to add
to the Board of Directors.
WHAT IF A NOMINEE IS UNWILLING TO SERVE?
Each of the nominees has consented to serve a three-year term. If any of
them should become unavailable to serve as a director, the Board may designate a
substitute nominee. In that case, the persons named as proxies will vote for the
substitute nominee designated by the Board. In no event will proxies be voted
for the election of more than two nominees to the Board of Directors.
WHAT IS THE BACKGROUND OF THIS YEAR'S NOMINEES?
CLASS III DIRECTORS.
The directors standing for election are:
Ronald D. Agronin, 61, was elected as a director in April 1994. He has been
a consultant for Black Clawson Company ("Black Clawson"), a manufacturer of
paper making machinery, and United Container Machinery, Inc. ("United Container
Machinery"), a corrugating machinery manufacturer, since April 1998. From 1993
to April 1998, Mr. Agronin was Vice Chairman of Black Clawson and President and
Chief Executive Officer of United Container Machinery. He served as Executive
Vice President and Chief Operating Officer of Black Clawson from 1987 to 1993.
Mr. Agronin is the first cousin of Mr. Miller. Mr. Agronin is a member of the
Board's Compensation and Audit/Finance Committees.
John P. Kennedy, 54, was elected as a director in April 1994 and served as
Vice Chairman of the Board of Directors from May 1997 to December 1998. From
August 1994 to May 1997 he was Budget's President and Chief Operating Officer.
From November 1991 to August 1994, he was Chairman and President of Metro West,
Inc., whose wholly owned subsidiary previously owned Budget's San Diego airport
operations. From November 1990 to November 1991, he was an independent
consultant to the vehicle rental industry. From July 1985 to August 1989, he
served as President of NYRAC, Inc. d/b/a Budget Rent a Car of Kennedy and La
Guardia Airports. From 1968 to 1984, he served in various capacities with Avis,
Inc. ("Avis"), including Vice President of Operations.
Other Class III Director:
Jeffrey R. Mirkin, 46, who currently is a Class III Director, was not
nominated to stand for re-election to the Board of Directors. Mr. Mirkin was
elected as a director in October 1995. Since 1985, Mr. Mirkin has been the
President of Budget Rent a Car of Southern California ("SoCal"), a franchisee of
Budget in Southern California.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS VOTE "FOR"
THE ELECTION OF MR. AGRONIN AND MR. KENNEDY TO HOLD OFFICE UNTIL THE ANNUAL
MEETING OF STOCKHOLDERS IN 2002 OR UNTIL THEIR SUCCESSORS ARE ELECTED AND
QUALIFIED.
7
<PAGE> 12
DIRECTORS CONTINUING IN OFFICE
WHAT IS THE BACKGROUND OF THE DIRECTORS NOT STANDING FOR ELECTION THIS YEAR?
CLASS I DIRECTORS. The following Class I directors were elected at
Budget's 1998 annual meeting for terms ending in 2001:
Sanford Miller, 46, has been the Chairman of the Board of Directors and
Chief Executive Officer and a director since April 1994. From August 1991 to
August 1994, he was Vice President of Tranex Rentals of New York, Inc.
("Tranex"), which operated the Albany and Rochester Budget franchises, and from
December 1991 to August 1994, was Vice President of Capital City Leasing, Inc.
("Capital City"), which operated the Richmond, Virginia Budget franchise. From
1989 to 1991, Mr. Miller served as Director of Marketing, Special Accounts, for
Budget Rent-a-Car Corporation ("BRAC"). From 1981 to 1989, Mr. Miller was an
executive officer and principal stockholder of corporations that owned and
operated 30 Budget franchises that were sold to BRAC in 1989. From 1979 to 1981,
he was North East Regional Field Operation Manager for BRAC. Mr. Miller served
as President of the American Car Rental Association, a nationwide industry trade
association in 1993 and Chairman of the Licensee Local Market Advisory Board of
the Budget System in 1989 and 1990. Mr. Miller is also a director of Tranex
Credit Corporation, AVTEAM, Inc. and Peninsula Bank of Central Florida and is
the Chairman of the Board of College Foundation, Inc., Oswego State University.
Mr. Miller is the first cousin of Mr. Agronin.
James F. Calvano, 62, was elected as a director in August 1994. Since
January 1999, Mr. Calvano has been a consultant for MoneyGram Payment Systems,
Inc ("MoneyGram"), a provider of electronic money transfer services, where he
served as Chairman of the Board, Chief Executive Officer and a director from
December 1996 to July 1998 and was a consultant from February 1996 to December
1996. From June 1991 to February 1996, he was the Executive Vice President of
Marketing for Travelers Group, a subsidiary of Travelers, Inc. From November
1993 to February 1995, he was Chief Administrative Officer of Travelers
Insurance Companies. From June 1991 to May 1993, Mr. Calvano was President and
Chief Operating Officer of New Valley Corp. From January 1989 to December 1990,
Mr. Calvano was President and Chief Executive Officer of Carlson Travel Group
and Executive Vice President of Carlson Companies Inc. From November 1986 to
December 1988, he served as President of Commercial Credit Corp. and Executive
Vice President of Primerica Corp. Mr. Calvano served American Express Travel
Related Services Co., Inc. as its Vice Chairman, President of Payment Systems
Division, USA and President of Consumer Financial Services Division, USA between
October 1981 and November 1986. From 1972 to 1981, Mr. Calvano was employed by
Avis and served in various capacities, including President and Chief Executive
Officer, Executive Vice President and Chief Operation Officer and Group Vice
President, Western Hemisphere. Mr. Calvano is Chairman of the Board's Nominating
Committee and is a member of the Compensation Committee.
Martin P. Gregor, 35, was elected as a director in December 1996. Mr.
Gregor serves as a managing director of McDonald Investments, Inc., where he
began his employment as an associate in 1989. Mr. Gregor is Chairman of the
Board's Compensation Committee and is a member of the Audit/Finance Committee.
CLASS II DIRECTORS. The following Class II directors were elected at
Budget's 1998 annual meeting for terms ending in 2000:
Jeffrey D. Congdon, 55, was elected as a director in April 1994 and has
been Vice Chairman of the Board of Directors since January 1991. From January
1991 to March 1998 he also served as Budget's Chief Financial Officer. Since
December 1990, he has been Secretary, Treasurer and a director of Tranex Credit
Corporation, which provides financing for purchases of previously owned
vehicles. From 1980 to 1989, he was an executive officer and principal
stockholder of corporations that owned and operated 30 Budget franchises that
were sold to BRAC in 1989. From 1982 to 1996, Mr. Congdon owned and operated
retail new and/or used vehicle sales operations in Indianapolis, Indiana. Mr.
Congdon is currently a director of Smart Choice Automotive Group, Inc., which
conducts a retail used car sales business in Florida.
8
<PAGE> 13
Dr. Stephen L. Weber, 57, was elected as a director in April 1994. Since
June 1996, Dr. Weber has been the President of San Diego State University. From
August 1995 to June 1996, he was the Interim Provost at the State University of
New York System Office. From 1988 until June 1996, he was President of State
University of New York at Oswego. Dr. Weber is a member of Budget's Nominating
Committee.
F. Perkins Hixon, Jr., 40, was elected a director in April 1998. He has
served since February 1995 as a managing director of Credit Suisse First Boston
Corporation ("CSFBC") New York Investment Banking Department, where he was first
employed as an associate in 1985. Mr. Hixon also serves as a member of CSFBC's
Worldwide Investment Banking and Investment Committees. Mr. Hixon is the
Chairman of the Board's Audit/Finance Committee and is a member of the
Nominating Committee.
HOW ARE DIRECTORS COMPENSATED?
CASH COMPENSATION. Non-employee directors receive an annual retainer of
$18,000. Directors who are also employees of Budget are not separately
compensated for their service as directors.
OPTIONS. Non-employee directors are eligible to participate in Budget's
1994 Directors' Stock Option Plan ("Directors' Plan"). In 1998, Budget granted
options to purchase an aggregate of 90,000 shares of Class A common stock to
outside directors under the 1994 Directors' Plan. Of these options, options to
purchase 75,000 shares of Class A common stock were granted on February 26,
1998, expire on February 28, 2008 and are exercisable at a price of $30.875 per
share. The remaining options to purchase 15,000 shares of Class A common stock
were granted on April 23, 1998, expire on April 23, 2008 and are exercisable at
a price of $37.0625 per share.
HOW OFTEN DID THE BOARD MEET DURING 1998?
The Board of Directors met 7 times during 1998. Each director attended more
than 75% of the total number of meetings of the Board and Committees on which he
served.
WHAT COMMITTEES HAS THE BOARD ESTABLISHED?
The Board of Directors has standing Nominating, Compensation and
Audit/Finance Committees.
NOMINATING COMMITTEE. The Nominating Committee consists of Messrs. Calvano
and Hixon and Dr. Weber. This Committee is responsible for nominating candidates
for election to the Board of Directors. The Nominating Committee will consider
nominees recommended by Budget's stockholders if the nomination is set forth in
writing and delivered to Budget's General Counsel and Secretary at 125 Basin
Street, Suite 210, Daytona Beach, Florida 32114. During 1998 the Nominating
Committee held one meeting.
COMPENSATION COMMITTEE. The Compensation Committee consists of Messrs.
Gregor, Calvano and Agronin. The Compensation Committee establishes salaries,
incentives and other forms of compensation for senior officers of Budget,
administers Budget's incentive compensation and benefit plans and recommends
policies relating to such plans. This Committee met 10 times in 1998.
AUDIT/FINANCE COMMITTEE. The Audit/Finance Committee consists of Messrs.
Agronin, Gregor and Hixon. This Committee reviews Budget's accounting practices,
internal accounting controls and financial results and oversees the engagement
of Budget's independent auditors. The Audit/Finance Committee met twice in 1998.
9
<PAGE> 14
EXECUTIVE OFFICERS
The following table sets forth certain information regarding Budget's
executive officers:
<TABLE>
<CAPTION>
NAME AGE POSITION(S) WITH BUDGET
- ---- --- -----------------------
<S> <C> <C>
Sanford Miller............................. 46 Chairman of the Board of Directors, Chief
Executive Officer and Director
Jeffrey D. Congdon......................... 55 Vice Chairman of the Board of Directors and
Director
Robert L. Aprati........................... 54 Executive Vice President, General Counsel
and Secretary
Scott R. White............................. 35 Executive Vice President, Corporate
Development
Michael B. Clauer.......................... 42 Executive Vice President and Chief
Financial Officer
Mark R. Sotir.............................. 35 President, North America, Budget Rent a Car
Corporation
</TABLE>
Each of the above executive officers was elected by the Board to hold
office until the next annual election of officers and until his successor is
elected and qualified or until his earlier resignation or removal.
Robert L. Aprati has been Executive Vice President, General Counsel and
Secretary of Budget since August 1997, was Senior Vice President, General
Counsel and Secretary of BRAC from January 1988 to July 1997 and was Vice
President, General Counsel and Secretary of BRAC from September 1978 to January
1988. Mr. Aprati has been a long-standing director and is the immediate past
President of the American Car Rental Association.
Scott R. White has been Executive Vice President, Corporate Development
since February 1997. From August 1992 to February 1997, he worked in the
Investment Banking Department of CSFBC, most recently as a vice president. In
addition, he was a financial analyst at The First Boston Corporation from July
1986 to July 1989.
Michael B. Clauer has been Chief Financial Officer of Budget since November
1997 and an executive vice president since September 1998. From November 1997 to
September 1998 he was a senior vice president of Budget. From April 1996 to
November 1997, he served as Senior Director of Finance, Strategy & Planning for
the North America National Franchise Business Units of the Pepsi-Cola Company.
From September 1994 to April 1996, Mr. Clauer was the Senior Director -- Field
Finance for Pepsico International Restaurants, Inc. From June 1992 to September
1994, he served as Senior Director -- Finance, Central Division for Pizza Hut,
Inc.
Mark R. Sotir has been President, North America, Budget Rent a Car
Corporation since January 1999. Mr. Sotir has served in management positions for
BRAC since April 1995. From August 1998 to January 1999, he was Senior Vice
President, Operations, from June 1997 to August 1998 he was Vice President,
Marketing and from April 1995 to June 1996 he was Vice President, Revenue
Management. Prior to joining BRAC, Mr. Sotir was Marketing Manager for The
Coca-Cola Company from August 1994 to April 1995 and was Senior Production
Manager from July 1993 to August 1994.
For descriptions of the business experience of Messrs. Miller and Congdon,
see "Item 1 -- Election of Directors -- Directors Continuing in Office."
10
<PAGE> 15
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
LEASES
Alabama. Our Mobile, Alabama airport service facility is leased from
Messrs. Miller and Congdon and another individual. This lease terminates July
14, 1999 and is not subject to any renewal options. Rental payments under the
lease were approximately $67,464 in 1998.
Florida. Our Gainesville, Florida airport service facility is leased from
Mr. and Mrs. Miller, Mr. and Mrs. Congdon and another individual. This lease
terminates May 31, 1999, subject to renewal. Rental payments under the Lease
were approximately $48,350 in 1998. Our Tallahassee, Florida airport service
facility is leased from Mr. and Mrs. Miller, Mr. Miller's brother-in-law, who is
an employee of Budget, and an unrelated individual. This lease terminates May
31, 1999. Rental payments under the lease were approximately $55,260 in 1998.
Indiana. Mr. Congdon has a 50% equity interest in Tranex Realty, an entity
that owns two retail car sales facilities in Indianapolis, Indiana which are
leased to Budget. One lease terminates in March 2004 and the other lease
terminates in November 2004, each subject to renewal. The aggregate rental
payments under the leases totaled approximately $300,000 in 1998.
New York. Our Rochester, New York airport facility is leased from a
partnership formed by Mr. Miller and a former employee of Budget. This lease
terminates in 2013, subject to renewal. Rental payments under the lease were
approximately $90,000 in 1998. Our La Guardia, New York airport service facility
is leased from Messrs. Miller, Congdon and Kennedy. This lease terminates June
30, 1999, subject to renewal. Rental payments under the lease were approximately
$752,904 in 1998. Budget is also a guarantor and contingent sub-lessee of the
Rego Park, New York rental facility, which is leased from Mr. Miller and another
individual. The lease terminates August 31, 2002. Budget is a guarantor until
May 31, 1999. Rental payments under the lease were approximately $154,776 in
1998.
Ohio. We lease one of our Dayton, Ohio retail car sales facilities from
MCK Real Estate Corporation ("MCK"), which is owned by Messrs. Miller, Congdon
and Kennedy. This lease terminates in March 2007, subject to renewal. Rental
payments under the lease were approximately $144,038 in 1998.
Pennsylvania. Our Philadelphia, Pennsylvania retail vehicle sales
facility, regional administrative headquarters and vehicle maintenance facility
are leased from MCK. This lease terminates in September 2002, subject to
renewal. Rental payments under the lease were approximately $324,577 in 1998.
Virginia. Our Richmond, Virginia airport facility is leased from a
partnership formed by Mr. Miller and an another individual (the "Richmond
Partnership"). This lease terminates in 2013, subject to renewal. Rental
payments under the lease were approximately $103,300 in 1998. Our Chesterfield
County, Virginia non-airport facility is also leased from the Richmond
Partnership. This lease commenced in June 1994 and terminates in May 2014,
subject to renewal. Rental payments under this lease were approximately $45,912
in 1998. Our Richmond, Virginia retail vehicle sales facility is leased from
MCK. This lease terminates in October 2000, subject to renewal. Rental payments
under the lease were approximately $124,218 in 1998.
All of the above leases are on a triple net basis (i.e., we are responsible
for the payment of taxes, insurance and utilities and for the general
maintenance of these facilities in addition to our obligations to pay base
rent). We believe that these leases are on terms no less favorable to us than
could be obtained from unaffiliated third parties.
LOS ANGELES ACQUISITION
In connection with our acquisition of the Budget franchise for Los Angeles,
California (the "Los Angeles Acquisition"), we agreed to pay SoCal a royalty
equal to 5% of the monthly gross revenues derived from those operations, subject
to a minimum amount. In addition, we issued a note to SoCal in the principal
amount of approximately $4,750,000 (the "SoCal Note"), assumed the obligations
of SoCal
11
<PAGE> 16
under a note (the "SoCal Bank Note") in the principal amount of approximately
$4,700,000 which was secured by the personal guaranty of Mr. Mirkin and assumed
certain other indebtedness that was personally guaranteed by Mr. Mirkin. Mr.
Mirkin is the Chief Executive Officer and a general partner of SoCal and, upon
consummation of the Los Angeles Acquisition, became a director of Budget. We
operate as a sub-franchisee of SoCal in the San Diego territory and pay royalty
fees to SoCal based on rental revenues for vehicles other than trucks pursuant
to a franchise agreement (the "SoCal Franchise Agreement"). In 1998, we paid
SoCal approximately $6,686,525 in royalty fees (includes royalty fees paid by
BRAC). Except as described above, prior to the Los Angeles Acquisition, there
was no material relationship between Budget and SoCal. There was approximately
$559,505 of other indebtedness payable by us to SoCal at December 31, 1998.
Budget is a named defendant in an action for declaratory relief filed by
SoCal on March 23, 1998 in the Superior Court of Los Angeles in which SoCal is
seeking a determination, given the SoCal Franchise Agreement, as to whether
Budget can operate locations of Premier Car Rental LLC, Budget's insurance
replacement company, in Southern California. Also, SoCal is a party to a
shareholders' agreement dated as of October 20, 1995 among SoCal, Messrs.
Miller, Kennedy and Congdon and Budget (the "SoCal Shareholders' Agreement").
The SoCal Shareholders Agreement grants SoCal the right to designate one nominee
to Budget's Board of Directors, which nominee shall be reasonably satisfactory
to the Nominating Committee of the Board of Directors. SoCal's nominee, Mr.
Mirkin, was not found to be reasonably satisfactory to the Nominating Committee,
and Mr. Mirkin was not nominated as a director for election at the 1999 Annual
Meeting of Stockholders. On March 1, 1999, Mr. Mirkin filed suit in the Superior
Court of Los Angeles against Budget and Messrs. Miller, Kennedy and Congdon
seeking to require Budget to accept Mr. Mirkin as a member of the Board of
Directors.
VALCAR ACQUISITION
In connection with the acquisition of ValCar Rental Sales, Inc. in August
1996, we assumed an unsecured revolving credit note payable to Mr. Congdon in
the amount of $1.5 million. The note is due on demand and bears interest at the
prime rate plus 2%. Pursuant to this note, we made interest payments to Mr.
Congdon of approximately $123,250 in 1998 and paid off the notes in full with
payments of $500,000 and $1,000,000, respectively, in August and November in
1998.
EXECUTIVE SHARE PURCHASE PROGRAM
In December 1998, Budget's executive officers participated in Budget's
Executive Share Purchase Program (the "Program"). Under the Program, executive
officers purchased shares of Budget Class A common stock with funds from loans
provided by KeyBank National Association ("KeyBank"). The loans have terms of 3
years, and bear interest at a rate equal to 1/2% below the floating prime rate
at KeyBank (7.25% on February 2, 1999). Principal repayment is due at maturity
or upon termination or resignation of the officer's employment. Interest on the
loans is due quarterly and is paid by Budget to KeyBank and is to be reimbursed
by the officer to Budget from the officer's annual incentive award. If there is
no annual incentive paid in any year, interest accrues and rolls over to the
next year. Reimbursement of interest by the officer to Budget will be forgiven
if the price of Class A common stock and/or financial results reach certain
performance targets. Budget has guaranteed repayment of principal and interest
on the loans.
12
<PAGE> 17
Pursuant to the Program, the executive officers purchased shares of Class A
common stock, as follows:
<TABLE>
<CAPTION>
EXECUTIVE OFFICER SHARES PURCHASED DOLLAR AMOUNT OF PURCHASE
- ----------------- ---------------- -------------------------
<S> <C> <C>
Sanford Miller.................................. 38,498 $499,937.34
Jeffrey D. Congdon.............................. 38,498 499,937.34
Robert L. Aprati................................ 19,249 249,968.69
Scott R. White.................................. 15,399 199,972.34
Michael R. Clauer............................... 15,399 199,972.34
Mark R. Sotir................................... 9,625 124,990.83
</TABLE>
TRANEX CREDIT CORPORATION
Mr. Congdon owns a 50% equity interest in and serves as Secretary and
Treasurer and a director of Tranex Credit Corporation ("Tranex"). In 1998, we
sold accounts receivable to Tranex totaling approximately $2,614,937 generated
pursuant to financing arrangements we extended to purchasers of vehicles sold by
us at our retail sales locations.
COLONIAL BANK
Until March 1998, Mr. Miller served as a director of Colonial Bank of
Volusia County in Ormond Beach, Florida. We maintained a cash management account
at that bank with an average balance during 1998 of approximately $1,540,778.
PENINSULA BANK
In December 1998, Mr. Miller became a director of Peninsula Bank of Central
Florida, in Daytona Beach, Florida. We maintained a cash management account at
that bank which had an average balance during 1998 of approximately $446,150.
CREDIT SUISSE FIRST BOSTON CORPORATION
Mr. Hixon, one of our directors, is a managing director of CSFBC, an
investment banking firm which periodically performs fee-based services for us.
CSFBC and its affiliates have provided extensive investment banking and advisory
services to us in connection with certain of our debt facilities and public
offerings of securities for customary fees. Most recently, during 1998 CSFBC
acted as a lead underwriter in connection with the offering of 6 1/4%
convertible trust preferred securities (HIGH TIDES) of Budget Group Capital
Trust, a subsidiary of Budget, and served as our financial advisor in connection
with our acquisition of Ryder TRS, Inc. in June 1998. CSFBC is also a lender
under our $550 million credit facility.
13
<PAGE> 18
EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Budget's executive compensation program is administered by the Compensation
Committee of the Board of Directors. The Compensation Committee consists
entirely of directors who are not employees of Budget to ensure that executive
compensation is determined in an objective manner. In addition to determining
the salary and bonus compensation for Budget's most highly compensated executive
officers, the Compensation Committee administers Budget's 1994 Incentive Stock
Option Plan (the "Plan") and, accordingly, determines the nature, timing and
amount of option grants to executive officers under the Plan.
Executive Officer Compensation Policy. Budget is engaged in a highly
competitive and dynamic industry, and Budget's success depends in large part
upon its ability to attract, motivate, retain and reward executive officers. The
Compensation Committee endeavors to align the long-term interests of Budget, its
stockholders and its management in determining executive compensation. The
Compensation Committee believes the mutuality of interests between Budget's
executive officers and Budget's stockholders is strengthened by increasing
executive officer's ownership of Common Stock through equity-based compensation.
A significant portion of executive officer compensation, therefore, generally
consists of stock option grants.
At least annually the Compensation Committee reviews the individual
contributions and performance of each executive officer, as well as prior
compensation granted. The Compensation Committee takes into account the Chief
Executive's recommendation as well as various qualitative and quantitative
indicators of corporate and individual performance in determining the level and
composition of compensation for executive officers. In particular, the
Compensation Committee considers several financial performance measures,
including stock price, revenue growth and net income, as well as the individual
executive's work experience, level of responsibility and contribution to
Budget's long-term success. It also monitors executive compensation levels of
certain comparably sized public companies to ensure Budget's executive
compensation levels remain competitive. The Compensation Committee does not,
however, apply any specific quantitative formula in making compensation
decisions.
Executive compensation decisions in 1998 were largely considered in light
of the successful completion of the acquisition of Ryder TRS, Inc. ("Ryder") in
June 1998 and several other acquisitions throughout the year which increased the
size and complexity of Budget. Considerations included the contributions of
executive officers to the successful completion of the 1998 acquisitions the
compensation level of officers of acquired companies who joined Budget in 1998,
and the need to attract and motivate seasoned, new executive officers to Budget
who are able to make valuable contributions to the integration of acquired
companies and to Budget's growth.
The Board of Directors also considered the restructuring and other
initiatives announced by Budget in November 1998 and the need to retain
qualified executive officers to implement these initiatives. To incent the
executive officers in connection with the announced restructuring plan, Budget
entered into agreements with respect to guaranties and interest repayment
obligations on loans from KeyBank to the executive officers. The proceeds of the
loans were used by the executive officers to purchase shares of Budget's common
stock.
Chief Executive Officer Compensation. The compensation of the Chief
Executive Officer, Mr. Miller, is established by the Compensation Committee and
reviewed and adjusted at least annually. Mr. Miller's compensation is
principally comprised of a base salary, a bonus and stock option awards which
are primarily tied to Budget's revenue growth, net income per share in the prior
year, and other achievements in the current year. In determining the
reasonableness of the compensation awarded to Mr. Miller in 1998, the
Compensation Committee applied the policies and factors discussed above with an
emphasis on Mr. Miller's contribution to the successful completion of the Ryder
and other 1998 strategic acquisitions and his continuing importance to the
strategic direction and growth of Budget.
14
<PAGE> 19
Mr. Miller's base salary to March 31, 1998 was $380,000 per year. From
April 1 to December 31, 1998, Mr. Miller's base salary increased to $500,000 per
year. In addition, in 1998 Budget paid Mr. Miller a $327,000 bonus and granted
Mr. Miller an option to purchase 115,000 shares of Class B Common Stock under
the Plan with an exercise price equal to the fair market value of the underlying
stock on the date prior to the date of grant.
The Committee has determined that it is unlikely that Budget would pay any
amounts for 1998 that would result in a loss of the federal income tax deduction
under Section 162(m) of the Internal Revenue Code of 1986, as amended, and
accordingly, has not recommended that any special actions be taken or that any
plans or programs be revised at this time.
THE COMPENSATION COMMITTEE
James F. Calvano
Ronald D. Agronin
Martin P. Gregor
The Compensation Committee Report on Executive Compensation shall not be
deemed incorporated by reference by any general statement incorporating by
reference this Proxy Statement into any filing under the Securities Act of 1933
or under the Securities Exchange Act of 1934 (together, the "Acts"), except to
the extent Budget specifically incorporates this information by reference, and
shall not otherwise be deemed filed under such Acts.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Gregor, a director who served on Budget's Compensation Committee in
1998, is a managing director of MacDonald Investments, Inc. ("MCSI"), an
investment banking firm which periodically performs services for Budget for
which it receives compensation. MCSI served as a co-managing underwriter in
connection with the offering of 6 1/4% convertible trust preferred securities
(HIGH TIDES) of Budget Group Capital Trust in June 1998 and provided financial
advisory services in connection with Budget's employee benefit plans.
EXECUTIVE SEVERANCE AGREEMENTS
Budget has entered into a severance agreement (the "Severance Agreement")
with each of Messrs. Miller, Congdon, Aprati, White, Sotir and Clauer (each an
"Executive") which provides for severance payments and benefits to the Executive
if his employment is terminated under various circumstances described therein.
Under each Severance Agreement, if an Executive's employment is terminated (a)
voluntarily by the Executive within one year after a "change in control" of
Budget, (b) by reason of the Executive's death or "disability", (c) within one
year after the occurrence of certain other events constituting "good reason" or
(d) involuntarily terminated without "cause" (as such terms are defined in the
Severance Agreement), the Executive generally would be entitled (i) to receive
an amount of up to three times the sum of the Executive's annual base salary
rate plus certain bonus amounts, (ii) to receive his base salary and a pro rated
portion of his target bonus through the date of termination, (iii) to receive
certain contributions (or equivalents) under the Budget Defined Contribution
Retirement Plan, (iv) to continue to participate in Budget's insurance benefit
programs for up to 36 months, (v) to use up to two Company cars for up to 36
months and (vi) to receive certain other benefits. The amount equivalent to the
Executive Annual Base Salary plus certain bonus amounts is payable in lump sum
within 30 days of termination.
15
<PAGE> 20
EXECUTIVE COMPENSATION SUMMARY TABLE
The following table sets forth information concerning total compensation
earned or paid to the Chief Executive Officer and the four other most highly
compensated executive officers of Budget who served in such capacities as of
December 31, 1998 (the "Named Executive Officers") for services rendered to
Budget during each of the last three fiscal years.
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
ANNUAL COMPENSATION ------------
------------------------------------- SECURITIES
OTHER ANNUAL UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION(1) OPTIONS COMPENSATION(2)
- --------------------------- ---- -------- -------- --------------- ------------ ---------------
<S> <C> <C> <C> <C> <C> <C>
Sanford Miller............. 1998 $468,807 $327,000 -- 115,000 $ 3,667
Chairman of the Board 1997 317,500 334,000 -- 90,000 17,625
of Directors and Chief 1996 208,250 -- -- 60,000 792
Executive Officer
Jeffrey D. Congdon......... 1998 406,874 286,500 95,000 3,525
Vice Chairman of the 1997 298,750 333,000 -- 75,000 2,855
Board of Directors 1996 133,200 -- -- 52,000 1,041
Robert L. Aprati(3)........ 1998 220,444 150,000 -- 50,000 2,969
Executive Vice President, 1997 133,200 150,000 -- 50,000 4,152
General Counsel and 1996 -- -- -- -- --
Secretary
Scott R. White(4).......... 1998 189,157 175,000 -- 50,000 2,177
Executive Vice President, 1997 139,583 -- -- 50,000 --
Corporate Development 1996 -- -- -- -- --
Michael B. Clauer(5)....... 1998 218,563 40,000 -- 35,000 577
Executive Vice President
and 1997 25,000 40,000 -- 40,000 92
Chief Financial Officer 1996 -- -- -- -- --
</TABLE>
- ---------------
(1) While the Named Executive Officers enjoy certain perquisites, for fiscal
years 1998, 1997 and 1996 these did not exceed the lesser of $50,000 or 10%
of each Named Executive Officer's salary and bonus.
(2) Represents, for 1998, Budget's matching contribution under Budget's 401(k)
Plan in the amount of $2,400 for each of Messrs. Miller, Congdon and Aprati
and $1,680 for Mr. White and $1,267, $1,125, $569, $497 and $577 of premiums
on term life insurance policies for Messrs. Miller, Congdon, Aprati, White
and Clauer, respectively. Represents, for 1997, Budget's matching
contribution under Budget's 401(k) Plan in the amount of $1,875 for each of
Messrs. Miller and Congdon and $3,600 for Mr. Aprati and $15,750, $980, $552
and $92 of premiums on term life insurance policies for Messrs. Miller,
Congdon, Aprati and Clauer respectively. Represents, for 1996, Budget's
matching contributions under Budget's 401(k) Plan of $792 and $1,041 Mr.
Miller and Mr. Congdon, respectively.
(3) Mr. Aprati commenced serving as an executive officer in August 1997. The
1997 salary reflects amounts paid from April 30, 1997, when Team Rental,
Inc. acquired Budget Rent A Car, to December 31, 1997.
(4) Mr. White began his employment with Budget and commenced serving as an
executive officer in February 1997.
(5) Mr. Clauer began his employment with Budget in November 1997 and commenced
serving as an executive officer in September 1998.
16
<PAGE> 21
OPTION GRANTS DURING 1998 AND YEAR-END OPTION VALUES
The following table describes the stock options granted to the Named
Executive Officers in 1998:
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
INDIVIDUAL GRANTS VALUE AT ASSUMED
-------------------------------------------------------- ANNUAL RATES OF
NUMBER OF PERCENT OF TOTAL STOCK PRICE
SECURITIES OPTIONS APPRECIATION
UNDERLYING GRANTED TO EXERCISE OR FOR OPTION TERM(1)
OPTIONS EMPLOYEES IN BASE PRICE EXPIRATION ---------------------
NAME GRANTED(2) FISCAL YEAR(5) PER SHARE DATE 5% 10%
- ---- ---------- ---------------- ----------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
Sanford Miller.............. 115,000(3) 5.7% $30.875 2/26/08 2,232,969 5,658,782
Jeffrey D. Congdon.......... 95,000(3) 4.8 30.875 2/26/08 1,844,627 4,674,646
Robert L. Aprati............ 50,000(4) 2.5 30.875 2/26/08 970,856 2,460,340
Scott R. White.............. 50,000(4) 2.5 30.875 2/26/08 970,856 2,460,340
Michael B. Clauer........... 35,000(4) 1.7 30.875 2/26/08 679,599 1,727,238
</TABLE>
- ---------------
(1) Potential realizable value assumes that the stock price increases from the
date of grant until the end of the option term (10 years) at the annual rate
specified (5% and 10%). The 5% and 10% assumed annual rates of appreciation
are mandated by Commission rules and do not represent Budget's estimate or
projection of the future price of Class A common stock. Budget does not
believe that this method accurately illustrates the potential value of a
stock option.
(2) All options granted to executive officers in 1998 vest in four equal annual
installments on February 26 of each year during the four-year period ending
February 26, 2002.
(3) Represents options to purchase shares of Class B common stock.
(4) Represents options to purchase shares of Class A common stock.
(5) Options to purchase a total of 1,785,700 shares of Class A common stock and
305,000 shares of Class B common stock were granted to employees in 1998.
AGGREGATE OPTION EXERCISES DURING 1998 AND YEAR-END OPTION VALUES
The following table sets forth certain information with respect to option
exercises by the Named Executive Officers during 1998 and the value of options
owned by the Named Executive Officers at December 31, 1998.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT IN-THE-MONEY OPTIONS AT
SHARES DECEMBER 31, 1998 DECEMBER 31, 1998(1)
ACQUIRED VALUE --------------------------- ---------------------------
NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Sanford Miller................. 0 0 90,000 115,000 0 0
Jeffrey D. Congdon............. 0 0 75,000 95,000 0 0
Robert L. Aprati............... 0 0 50,000 50,000 0 0
Scott R. White................. 0 0 50,000 50,000 0 0
Michael B. Clauer.............. 0 0 0 75,000 0 0
</TABLE>
- ---------------
(1) In accordance with SEC rules, values are calculated by subtracting the
exercise price from the fair market value of the underlying common stock.
For purposes of this table, fair market value is deemed to be $15.72, the
average of the high and low Class A common stock price reported for New York
Stock Exchange transactions on December 31, 1998.
As of December 31, 1998, options to purchase a total of 3,092,318 of Class
A common stock and 545,000 shares of Class B common stock with exercise prices
ranging from $9.50 to $36.44 per share were outstanding under Budget's 1994
Incentive Stock Option Plan.
On March 30, 1999, the closing sales price of the Class A common stock on
the New York Stock Exchange was $12.25.
17
<PAGE> 22
PERFORMANCE GRAPH
Set forth below is a line graph comparing the percentage change in the
cumulative total stockholder return on Budget's Class A common stock against the
cumulative total return of the Nasdaq Composite Index, the New York Stock
Exchange Composite Index, the Standard & Poors 500 Index and Budget's peer group
index. Budget's peer group consists of Amerco, National Auto Credit, Inc.,
Pacific International Services Corp., Rollins Truck Leasing Corp. and Ryder
Systems Inc. The stock performance graph assumes $100 was invested on August 18,
1994 (the date that the Class A common stock was first publicly traded) and
measures the return thereon at various points based on the closing price of the
Class A common stock on the dates indicated.
<TABLE>
<CAPTION>
Measurement Period
(Fiscal Year
Covered) BGI S&P 500 Peer Group NYSE NASDAQ
<S> <C> <C> <C> <C> <C>
8/18/94 100.0000 100.0000 100.0000 100.0000 100.0000
12/31/94 100.0000 99.1580 86.1029 98.2191 101.3191
12/31/95 89.4737 132.9815 98.7226 128.9717 141.7642
12/31/96 169.7370 159.9283 117.5381 153.5481 173.9536
12/31/97 363.8164 209.5192 123.3729 200.0823 211.5891
12/31/98 167.1055 265.3951 112.3105 233.2027 295.4432
</TABLE>
The Stock Performance Graph shall not be deemed incorporated by reference
by any general statement incorporating by reference this Proxy Statement into
any filing under either of the Acts, except to the extent Budget specifically
incorporates this information by reference, and shall not otherwise be deemed
filed under such Acts.
AMENDMENT OF RESTATED CERTIFICATE OF INCORPORATION
REGARDING SIZE OF BOARD OF DIRECTORS (ITEM 2)
WHAT IS THE PROPOSED AMENDMENT?
On February 25, 1999, the Board of Directors unanimously approved, subject
to stockholder approval, an amendment to Budget's Restated Certificate of
Incorporation to provide that (i) the Board shall consist of not less than seven
(7) nor more than twelve (12) directors, with the exact number of directors to
be determined from time to time by resolution of the Board and (ii) the Board
shall have the exclusive right to fix the number of directors. The Board has
resolved to fix the number of directors at eight (8) effective at the annual
meeting.
18
<PAGE> 23
The Board of Directors recommends that stockholders approve and adopt an
amendment to the Restated Certificate of Incorporation to add the following to
the beginning of Article Eighth of the Restated Certificate of Incorporation as
the first two sentences of such Article Eighth:
"The number of directors of the Corporation shall not be less than
seven (7) nor more than twelve (12), with the exact number of directors to
be fixed from time to time by resolution of the Board of Directors of the
Corporation. The Board of Directors shall have the exclusive right to fix
the number of directors."
WHAT ARE THE REASONS FOR THE PROPOSED AMENDMENT?
Under our existing Restated Certificate of Incorporation and our Bylaws,
the Board of Directors must have a minimum of three directors, but no maximum
number of directors is specified. The Board of Directors believes that it is in
the best interests of Budget and our stockholders to limit the maximum number of
directors at twelve (12) for a number of reasons:
- maintaining a manageable size of the Board of Directors will facilitate
communications and decision-making;
- the proposed amendment does not limit the Board of Directors to only its
current size, but provides flexibility for the Nominating Committee to
seek, from time to time, additional qualified candidates to serve on the
Board whose diversity and points of view will enhance our ability to
guide the future business and affairs of Budget; and
- setting a maximum number of directors avoids the likely need to fill a
high number of vacancies on short notice and thereby will allow the
Nominating Committee to preserve the quality of the directors who serve
on our Board.
The proposed amendment may have an anti-takeover effect by discouraging or
preventing stockholder groups or potential stockholders seeking to gain control
of Budget from altering the size or composition of the Board of Directors, if
such stockholders believe it will reduce their ability to affect Budget's
direction. The provision may also have the effect of giving existing management
a greater ability to retain their positions on the Board of Directors and to
dictate, to some degree, the Board's composition and membership.
The Board of Directors believes that the proposed amendment is in the
long-term best interests of the stockholders of Budget. The amendment to the
Restated Certificate of Incorporation is not being proposed in response to any
specific resignation, threat or resignation or refusal to serve by any director
nor is it in response to any specific stockholder action or proposal.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE
AMENDMENT TO THE RESTATED CERTIFICATE OF INCORPORATION.
RATIFICATION OF APPOINTMENT OF
INDEPENDENT ACCOUNTANTS (ITEM 3)
Budget has appointed Arthur Andersen LLP as Budget's independent
accountants for the fiscal year ending December 31, 1999. Arthur Andersen LLP
has served as Budget's independent accountants since 1996.
Representatives of Arthur Andersen LLP will be present at the annual
meeting to respond to appropriate questions and to make such statements as they
may desire.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" RATIFICATION
OF THE APPOINTMENT OF ARTHUR ANDERSEN LLP AS BUDGET'S INDEPENDENT ACCOUNTANTS
FOR FISCAL 1999.
19
<PAGE> 24
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires Budget's directors and executive
officers and persons who own more than 10% of a registered class of Budget's
equity securities to file with the Commission initial reports of ownership and
statements of changes in ownership of common stock and other equity securities
of Budget. Based solely upon a review of such reports furnished to Budget and
certain representations of such persons, all such persons complied with the
Section 16(a) reporting requirements except as follows: (i) the initial
statement of beneficial ownership on Form 3 required to be filed by Mr. Hixon
upon his becoming a director of Budget on April 23, 1998 was inadvertently not
timely filed and was filed on February 12, 1999; (ii) the initial statement of
beneficial ownership on Form 3 required to be filed by Mr. Sotir upon his
becoming a reporting officer of Budget on January 5, 1999 was inadvertently not
timely filed and was filed on March 15, 1999; and (iii) the purchase of 1,800
shares of Class A common stock on December 16, 1998 reportable on Form 4
required to have been filed by January 11, 1999 and the inheritance of 100
shares on December 21, 1998 by Mr. Agronin's wife reportable on the Form 5 filed
on February 12, 1999 which both transactions were reported on a Form 4 filed on
March 15, 1999; (iv) the distribution of shares to Mr. Mirkin and other general
partners from a general partnership on March 25, 1998, reportable on a Form 4 by
June 10, 1998, in which Mr. Mirkin had investment power and voting control and
had previously reported all of the shares owned by the partnership, and a
transfer of 90,000 shares on June 30, 1998 by Mr. Mirkin to a charitable
remainder trust of which Mr. Mirkin is trustee and partial beneficiary,
reportable on the December 1998 Form 5, of all the foregoing transactions
relating to Mr. Mirkin were reported on a Form 5 filed on March 15, 1999; and
(v) the sale of 5,000 shares of Class A common stock on November 5, 1998 by Mr.
Calvano was not timely reported by December 10, 1998 and was reported on a Form
4 filed on March 15, 1999.
OTHER MATTERS
As of the date of this Proxy Statement, Budget knows of no business that
will be presented for consideration at the annual meeting other than the items
referred to above. If any other matter is properly brought before the meeting
for action by stockholders, proxies in the enclosed form returned to Budget will
be voted in accordance with the recommendation, in accordance with the judgment
of the proxy holder.
ADDITIONAL INFORMATION
DISCRETIONARY VOTING POWER. On May 21, 1998, the Commission adopted an
amendment to the Rules under the Exchange Act. The amendment to Rule 14a-4(c)(1)
governs Budget's use of its discretionary proxy voting authority with respect to
a stockholder proposal which is not addressed in Budget's proxy statement. The
amendment provides that if a proponent of a proposal fails to notify Budget at
least 45 days prior to the month and day of mailing of the prior year's proxy
statement, then Budget will be allowed to use its discretionary voting authority
when the proposal is raised at the meeting to which the proxy statement relates,
without any discussion of the matter in the proxy statement. If an issue comes
up for vote at the 1999 Annual Meeting that is not on the proxy card, Mr. Miller
and Mr. Congdon, as proxy holders, will vote your shares, under your proxy, in
accordance with their best judgment.
STOCKHOLDER PROPOSALS FOR THE 2000 ANNUAL MEETING. Stockholders interested
in presenting a proposal for consideration at Budget's annual meeting of
stockholders in 2000 may do so by following the procedures described in Rule
14a-8 under the Exchange Act. To be eligible for inclusion, stockholder
proposals must be received by the General Counsel and Secretary no later than
December 4, 1999.
ANNUAL REPORT ON FORM 10-K. Budget will provide without charge a copy of
its Annual Report on Form 10-K for the year ended December 31, 1998, including
the financial statements and financial statement schedules, as filed with the
Commission (without exhibits), upon the written request of any stockholder.
Copies of exhibits to the Annual Report on Form 10-K will be furnished (upon
payment of
20
<PAGE> 25
Budget's reasonable expenses in furnishing such exhibits) upon request to the
General Counsel and Secretary, Budget Group, Inc., 125 Basin Street, Suite 210,
Daytona Beach, Florida 32114.
PROXY SOLICITATION COSTS. The proxies being solicited hereby are being
solicited by Budget. The cost of soliciting proxies in the enclosed form will be
borne by Budget. Budget has retained MacKenzie Partners, 156 Fifth Avenue, PH 3,
New York, New York 10010, to aid in the solicitation. For these services, Budget
will pay MacKenzie Partners a fee of $5,000 and reimburse it for certain
out-of-pocket disbursements and expenses. Officers and regular employees of
Budget may, but without compensation other than their regular compensation,
solicit proxies by further mailing or personal conversations, or by telephone,
telex, facsimile or electronic means. Budget will, upon request, reimburse
brokerage firms and others for their reasonable expenses in forwarding
solicitation material to the beneficial owners of stock.
By order of the Board of Directors,
/s/ SANFORD MILLER
SANFORD MILLER
Chairman of the Board and
Chief Executive Officer
April 2, 1999
21
<PAGE> 26
Please mark
you votes as
indicated in [X]
this example
<TABLE>
<CAPTION>
FOR WITHHOLD
all nominees AUTHORITY
(except as marked to to vote for
the contrary below) nominees listed
<S> <C> <C> <C> <C>
FOR AGAINST ABSTAIN
Proposal No. 1. To elect two directors Proposal No. 2. To approve amending [ ] [ ] [ ]
to serve as Class III Budget's Restated
Directors, as follows: [ ] [ ] Certificate of Incorporation
to provide that the Board shall
be comprised of not less than
seven (7) nor more than twelve (12)
directors and that the Board shall
have the exclusive right to fix the
number of directors.
Ronald D. Agronin John P. Kennedy
(Instructions: To withhold authority to
vote for any individual nominee, strike Proposal No. 3 To ratify the action of the
a line through the nominee's name in the Board of Directors of Budget appointing
list above.) Arthur Andersen LLP as Budget's
independent auditors for the year
ending December 31, 1999.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
In their discretion, the Proxies are authorized to vote
upon such other business as may properly come before the
Annual Meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL
BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED STOCKHOLDER. IF NO
DIRECTION IS MADE, THIS PROXY WILL BE
VOTED "FOR" ALL PROPOSALS. IF ANY OTHER
MATTERS ARE PROPERLY PRESENTED AT THE
ANNUAL MEETING FOR ACTION TO BE TAKEN
THEREUNDER, THIS PROXY WILL BE VOTED ON
SUCH MATTERS BY THE PERSONS NAMED AS
PROXIES HEREIN IN ACCORDANCE WITH THEIR
BEST JUDGMENT.
Signature(s)___________________________________________________Name(s)__________________________________Date:_____________, 1999
Please sign exactly as your name or names appear hereon. Where more than one owner is shown above, each should sign. When signing
in a fiduciary or representative capacity, please give full title. If this Proxy is submitted by a corporation, limited liability
company or partnership, it should be executed in the full entity name by a duly authorized officer, member or partner, as the case
may be.
- -----------------------------------------------------------------------------------------------------------------------------------
* FOLD AND DETACH HERE *
</TABLE>
<PAGE> 27
PROXY CARD
BUDGET GROUP, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF STOCKHOLDERS ON APRIL 28, 1999
The undersigned hereby appoints SANFORD MILLER and JEFFREY D. CONGDON, and
each of them, Proxies, with full power of substitution and resubstitution, for
and in the name of the undersigned, to vote all shares of stock of Budget Group,
Inc. (the "Company"), which the undersigned would be entitled to vote if
personally present at the 1999 Annual Meeting of Stockholders (the "Annual
Meeting") to be held on Wednesday, April 28, 1999, beginning at 10:00 a.m. local
time at the Hilton Daytona Beach Ocean Front Resort, 2637 S. Atlantic Avenue,
River Room, Daytona Beach, Florida (904) 767-7350 and at any adjournment
thereof, upon the matters described in the accompanying Notice of Annual Meeting
of Stockholders and Proxy Statement, receipt of which is hereby acknowledged,
and upon any other business that may properly come before the meeting or any
adjournment thereof. Said Proxies are directed to vote on the matters described
in the Notice of Annual Meeting and Proxy Statement as follows, and otherwise in
their discretion upon such other business as may properly come before the
meeting or any adjournment thereof.
PLEASE COMPLETE, DATE AND SIGN THIS PROXY AND RETURN IT PROMPTLY IN THE
ENCLOSED ENVELOPE, WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING. IF YOU
ATTEND THE MEETING, YOU MAY VOTE IN PERSON IF YOU WISH, EVEN IF YOU HAVE
PREVIOUSLY RETURNED YOUR PROXY.
(Continued and to be signed on reverse side)
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
