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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. ______)
BUSINESS RESOURCE GROUP
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(NAME OF ISSUER)
Common Stock, $.01 Par Value
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(Title of Class of Securities)
12329K 10 4
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(CUSIP Number)
ROD HOWARD
BROBECK PHLEGER & HARRISON LLP
TWO EMBARCADERO PLACE
2200 GENG ROAD
PALO ALTO, CALIFORNIA 94303
(650) 812-2596
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(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
July 7, 2000
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(Date of Event which Requires Filing of this Statement)
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If the filing person has previously filed a statement on Schedule 13G
to report the acquisition which is the subject of this Schedule 13D,
and is filing this schedule because of Rule 13d-l(e), 13d-1(f) or
13d-1(g), check the following box. |X|
Note: Schedules filed in paper format shall include a signed original
and five copies of the schedule, including all exhibits. See Rule
13d-7(b) for other parties to whom copies are to be sent.
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The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class
of securities, and for any subsequent amendment containing information
which would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not
be deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 or otherwise subject to the liabilities of that
section of the Act but shall be subject to all other provisions of the
Act (however, see the Notes).
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CUSIP No. 12329K 10 4
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1. Names of Reporting Persons-- I.R.S. Identification Nos. of above
persons (entities only)--
Jack W. Peth
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2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) N/A..............................................................
(b) N/A..............................................................
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3. SEC Use Only .........................................................
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4. Source of Funds (See Instructions) OO
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5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items
2(d) or 2(e) ............................. ...........................
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6. Citizenship or Place of Organization - UNITED STATES
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Number of 7. Sole Voting Power: 442,250
Shares Beneficially --------------------------------------------------------
Owned by 8. Shared Voting Power: -0-
Each Reporting --------------------------------------------------------
Person With 9. Sole Dispositive Power: 442,250
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10. Shared Dispositive Power: -0-
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11. Aggregate Amount Beneficially Owned by Each Reporting Person. 442,250
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12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions)...............
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13. Percent of Class Represented by Amount in Row (11). 7.7%
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14. Type of Reporting Person (See Instructions) - IN
......................................................................
......................................................................
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CUSIP No. 12329K 10 4
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1. Names of Reporting Persons-- I.R.S. Identification Nos. of above
persons (entities only)--
Brian D. McNay
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2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) N/A..............................................................
(b) N/A..............................................................
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3. SEC Use Only..........................................................
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4. Source of Funds (See Instructions) OO
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5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items
2(d) or 2(e) ...............
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6. Citizenship or Place of Organization - UNITED STATES
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Number of 7. Sole Voting Power: 633,390
Shares Beneficially -----------------------------------------------------
Owned by 8. Shared Voting Power: -0-
Each Reporting -----------------------------------------------------
Person With 9. Sole Dispositive Power : 633,390
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10. Shared Dispositive Power: -0-
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11. Aggregate Amount Beneficially Owned by Each Reporting Person. 633,390
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12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions)...............
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13. Percent of Class Represented by Amount in Row (11). 11.9%
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14. Type of Reporting Person (See Instructions) - IN
......................................................................
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CUSIP No. 12329K 10 4
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1. Names of Reporting Persons-- I.R.S. Identification Nos. of above
persons (entities only)--
Jeffrey Tuttle
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2. Check the Appropriate Box if a Member of a Group (See Instructions)
(a) N/A..............................................................
(b) N/A..............................................................
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3. SEC Use Only .........................................................
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4. Source of Funds (See Instructions) OO
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5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items
2(d) or 2(e) ............................. ...........................
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6. Citizenship or Place of Organization - UNITED STATES
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Number of 7. Sole Voting Power: 960,000
Shares Beneficially --------------------------------------------------------
Owned by 8. Shared Voting Power: -0-
Each Reporting --------------------------------------------------------
Person With 9. Sole Dispositive Power: 960,000
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10. Shared Dispositive Power: -0-
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11. Aggregate Amount Beneficially Owned by Each Reporting Person. 960,000
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12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions)...............
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13. Percent of Class Represented by Amount in Row (11). 18.1%
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14. Type of Reporting Person (See Instructions) - IN
......................................................................
......................................................................
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ITEM 1...SECURITY AND ISSUER.
This statement on Schedule 13D (the "Schedule 13D")
relates to the common stock, par value $.01 per share of
Business Resource Group (the "Issuer"), a California
corporation (the "Issuer Common Stock"). The principal
executive offices of the Issuer are located at 2150 North
First Street, Suite 101, San Jose, CA 95131.
ITEM 2. IDENTITY AND BACKGROUND.
(a) This Schedule 13D is being filed jointly on behalf of the
following persons (collectively, the "Reporting Persons"): (1)
Jack W. Peth, (2) Brian D. McNay, and (3) Jeffrey Tuttle.
(b) The address of each of the Reporting Persons is c/o
Business Resource Group, 2150 N. First Street, Suite 101, San
Jose, CA 95131.
<TABLE>
<CAPTION>
(c) Name, Business Address
Principal Occupation or Employment
<S> <C>
Jack W. Peth 2150 N. First Street, Suite 101
President and Chief Executive Officer San Jose, CA 95131
Brian D. McNay 2150 N. First Street, Suite 101
Executive Vice President, Sales San Jose, CA 95131
Jeffrey Tuttle 2150 N. First Street, Suite 101
Executive Vice President, Marketing San Jose, CA 95131
</TABLE>
(d)-(e) During the last five years none of the Reporting
Persons has been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors). Also
during the last five years none of the Reporting Persons was
a party to a civil proceeding of a judicial or administrative
body of competent jurisdiction as a result of which such
person was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating
activity subject to, federal or state securities laws or
finding any violation with respect to such laws.
Consequently, none of the Reporting Persons is required to
disclose legal proceedings pursuant to Item 2(d) or 2(e) of
Schedule 13D.
(f) Each of the Reporting Persons is a United States citizen.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Each of the Reporting Persons has previously reported his
individual ownership of five percent of the common stock of
Issuer on a Schedule 13G. This Schedule 13D is
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being filed in accordance with Rule 13d-1(e)(1) because each
of the Reporting Persons now holds the securities with a
purpose or effect of changing or influencing control of the
Issuer and has become a participant in a tender offer and
merger as described in Item 4(a)-(b) below. No purchases of
Issuer common stock are being reported on this Schedule 13D.
ITEM 4. PURPOSE OF TRANSACTION.
(a)-(b) The Reporting Persons have entered into agreements
which are part of a package of agreements described below.
This package of agreements is intended to enable BR Holdings
LLC ("BR Holdings"), through BRG Acquisition Corporation
("BAC"), a Delaware corporation and a wholly owned subsidiary
of BR Holdings, to acquire all the outstanding stock of the
Issuer and effect the merger of BAC with the Issuer.
On July 7, 2000, the Issuer and BAC entered into a
Plan and Agreement of Merger (the "Merger Agreement"), between
the Issuer and BAC. Pursuant to the Merger Agreement, and
subject to the conditions set forth therein, BAC will make a
tender offer to purchase all outstanding shares of common
stock of the Issuer (the "Tender Offer"). The Tender Offer
will be conditioned on at least 51% of the outstanding shares
not owned by BAC and its affiliates immediately before the
Tender Offer expires being properly tendered and not
withdrawn. If BAC purchases the tendered shares, BAC and BR
Holdings will take all steps in their power (including voting
their shares) to cause BAC to be merged with the Issuer (the
"Merger") in a transaction in which BR Holdings (which through
an intermediate wholly owned holding corporation is the sole
stockholder of BAC) will become the owner of all the stock of
the corporation which results from the Merger, and the other
shareholders of the Issuer will receive the same amount of
cash per share as is paid for shares tendered in response to
the Tender Offer (unless shareholders have rights to demand
appraisal of their shares and particular shareholders exercise
those rights). If less than 51% of the outstanding shares that
neither BAC nor BR Holdings owns immediately before the Tender
Offer expires are properly tendered and not withdrawn, (i) BAC
may not purchase the shares which are tendered unless the
Issuer consents to its doing so, and (ii) if BAC does not
purchase the tendered shares, the Merger will not take place.
The affirmative vote of holders of a majority of the
outstanding shares (including any shares owned by BAC and its
affiliates) may be required to approve the Merger. BAC already
has the right to acquire certain of the Reporting Persons'
shares of Issuer Common Stock covered by this Schedule 13D
and the Merger will not be presented to the stockholders
unless BAC has acquired through the Tender Offer at least 51%
of the remaining shares of Issuer Common Stock. Therefore, if
the Merger is presented to the stockholders for approval, BAC
and its affiliates will be able to cause the Merger to be
approved, even if no other shareholders vote for it. If BAC
acquires at least 90% of the outstanding shares, shareholder
approval will not be required.
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The foregoing summary of the Merger Agreement is
qualified in its entirety by reference to the Merger Agreement
included as Exhibit 2 to this Schedule 13D and incorporated
herein in its entirety by reference.
As a condition and inducement to BAC's Tender Offer
and willingness to enter into the Merger Agreement, Mr. McNay
and Mr. Tuttle have entered into Share Exchange Agreements
dated as of July 7, 2000 with BR Holdings whereby they will
exchange shares of Issuer Common Stock for interests in BR
Holdings. The Issuer common stock and options exchanged for
interests in BR Holdings will be returned to Mr. McNay and Mr.
Tuttle if BAC does not make a tender offer for Issuer Common
Stock or does not accept the shares which are tendered in
response to the tender offer. The foregoing summary of the
Share Exchange Agreements is qualified in its entirety by
reference to the Share Exchange Agreements included as
Exhibits 3 and 4 to this Schedule 13D and incorporated herein
in their entirety by reference.
Mr. Peth has entered into a deferred compensation
agreement, dated as of July 7, 2000, with BR Holdings (the
"Deferred Compensation Agreement"), which provides for the
cancellation of all options held by Mr. Peth immediately prior
to the effective time of the Merger. That agreement also
provides for conditional payments to Mr. Peth if, as and when
the surviving corporation in the Merger repays the preferred
stock and subordinate debt, if any, issued in exchange for the
cash to be used to pay the offer price in the Tender Offer.
The Deferred Compensation Agreement is included as Exhibit 8
to this Schedule 13D and incorporated herein in its entirety
by reference.
As a condition and inducement to the Reporting
Persons' willingness to enter into the Share Exchange
Agreements and the Option Cancellation Agreement, BAC has
entered into employment agreements with the Reporting Persons
(the "Employment Agreements") dated as of July 7, 2000 under
which, and subject to the conditions set forth therein, if BAC
acquires the Issuer, the Reporting Persons will be employed by
BAC (which, after the Merger would own and operate the
business of the Issuer). The foregoing summary of the
Employment Agreements is qualified in its entirety by
reference to the Employment Agreements included as Exhibits 5,
6, and 7 to this Schedule 13D and incorporated herein in
their entirety by reference.
(c) Not applicable.
(d) Upon consummation of the Merger, the members of the Board
of Directors of BAC will be the members of the Board of
Directors of the surviving corporation and will hold office in
accordance with the by-laws of the surviving corporation.
(e) The Merger Agreement prohibits the Issuer from paying any
dividends or making other distributions with regard to its
stock or from issuing any shares between the date of the
signing of the Merger Agreement and the Effective Time.
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As a result of the Merger, each share of Issuer
Common Stock which is not owned by BAC will become the right
to receive $9.25 in cash, or any other price per share paid
with regard to the shares tendered in response to the Tender
Offer (which may not be less than $9.25 per share) and (b)
each share of Issuer Common Stock owned by BAC or its
stockholders, including BR Holdings, or by the Issuer or its
subsidiaries, will be cancelled and no payment will be made
with respect to those shares. In addition, each outstanding
option or warrant issued by the Issuer will become the right
to receive (i) the amount, if any, by which the Tender Offer
price exceeds the exercise price of the option or warrant,
times (ii) the number of shares issuable upon exercise of the
option or warrant in full.
(f) Other than as a result of the Merger described in Item
4(a)-(b) above, not applicable.
(g) None.
(h) The purchase of the shares tendered in response to the
Tender Offer will reduce the number of shares that might
otherwise trade publicly and probably will significantly
reduce the number of holders of shares, which could adversely
affect the liquidity and market value of the remaining shares
held by the public. Depending upon the number of shares
purchased as a result of the Tender Offer, the shares may no
longer meet the standards of the National Association of
Securities Dealers, Inc. (the "NASD") for continued inclusion
in the Nasdaq National Market (the top tier market of the
Nasdaq Stock Market), which require that the Issuer have at
least 200,000 publicly held shares with a market value of $1
million held by at least 400 holders of shares (or 300
shareholders holding round lots) and have net tangible assets
of at least $1 million, $2 million or $4 million depending on
profitability levels during the Issuer's four most recent
fiscal years. If these standards are not met, the shares might
nevertheless continue to be included in the NASD's Nasdaq
National Market with quotations published in the Nasdaq
"additional list" or in one of the "local lists." However, if
the number of holders of shares falls below 300 or the number
of publicly held shares falls below 100,000, or if there are
not at least two market makers for shares, the shares would no
longer qualify for Nasdaq Stock Market reporting, and the
Nasdaq Stock Market would cease to provide any quotations.
Shares held directly or indirectly by an officer or director
of the Issuer, or by a beneficial owner of more than 10% of
the shares, ordinarily will not be considered as being
publicly held for this purpose. If, as a result of the
purchase of shares pursuant to the Tender Offer or otherwise,
the shares no longer meet the NASD requirements for continued
inclusion on the Nasdaq National Market or in any other tier
of the Nasdaq Stock Market, the ability to sell shares could
be adversely affected.
If the shares no longer meet the requirements for
inclusion in any tier of the Nasdaq Stock Market, quotations
might or might not still be available from other sources. The
extent of the public market, and availability of quotations,
for the shares would depend upon the number of holders of
shares after the purchase of the shares
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tendered in response to the Tender Offer, whether securities
firms are interested in maintaining a market in the shares,
the possible termination of registration under the Securities
and Exchange Act of 1934, as amended (the "Exchange Act"), as
described below, and other factors.
(i) The shares of the Issuer are currently registered under
the Exchange Act. That registration may be terminated upon
application of the Issuer to the Securities and Exchange
Commission if the shares are not listed on a national
securities exchange or quoted on the Nasdaq Stock Market and
there are fewer than 300 record holders of the shares. The
termination of registration of the shares under the Exchange
Act would substantially reduce the information the Issuer
would be required to furnish to holders of shares and to the
SEC and would make certain provisions of the Exchange Act,
such as the short-swing profit recovery provisions of Section
16(b) of the Exchange Act, the requirement that the Issuer
furnish a proxy statement or information statement in
connection with shareholder actions pursuant to Section 14 of
the Exchange Act, and the requirements of Rule 13e-3 under the
Exchange Act with respect to "going-private" transactions, no
longer applicable to the Issuer. In addition, "affiliates" of
the Issuer and persons holding "restricted securities" of the
Issuer may be deprived of the ability to dispose of those
securities pursuant to Rule 144 under the Securities Act of
1933, as amended. If BAC purchases the shares which are
tendered in response to the Tender Offer, the Issuer may seek
to cause the Issuer to terminate quotation of the shares on
the Nasdaq Stock Market and, if there are fewer than 300
remaining shareholders of record, to apply to terminate the
registration of the shares under the Exchange Act. It might do
that before the shareholders are asked to vote to approve the
Merger (if shareholder approval is required), in which case
the Issuer could give the necessary approval of the Merger
without the Issuer's sending a proxy statement or an
information statement to its shareholders. BAC will seek to
cause the Issuer to terminate the registration of the shares
under the Exchange Act as soon as practicable after they are
no longer quoted on the Nasdaq Stock Market.
(j) To Reporting Persons' knowledge, other than described
above, none.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a)-(b) Jack W. Peth
The number of shares of common stock beneficially
owned by Mr. Peth is 442,250 or approximately 7.7% of the
issued and outstanding shares of common stock. The shares
beneficially owned by Mr. Peth include 431,250 shares of
common stock which may be acquired pursuant to options to
purchase common stock.
The number of shares of common stock as to which Mr.
Peth has the sole power to vote or direct the vote, and to
dispose or to direct the disposition is 442,250. The number of
shares of common stock as to which Mr. Peth shares the power
to vote or to direct the vote, and to dispose or to direct the
disposition is none.
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<PAGE>
Brian D. McNay
The number of shares of common stock beneficially
owned by Mr. McNay is 633,390 or approximately 11.9% of the
issued and outstanding shares of common stock. The shares
beneficially owned by Mr. McNay include no shares of common
stock which may be acquired pursuant to options to purchase
common stock.
The number of shares of common stock as to which Mr.
McNay has the sole power to vote or direct the vote, and to
dispose or to direct the disposition is 633,390. The number of
shares of common stock as to which Mr. McNay shares the power
to vote or to direct the vote, and to dispose or to direct the
disposition is none.
Jeffrey Tuttle
The number of shares of common stock beneficially
owned by Mr. Tuttle is 960,000 or approximately 18.1% of the
issued and outstanding shares of common stock. The shares
beneficially owned by Mr. Tuttle include no shares of common
stock which may be acquired pursuant to options to purchase
common stock.
The number of shares of common stock as to which Mr.
Tuttle has the sole power to vote or direct the vote, and to
dispose or to direct the disposition is 960,000. The number of
shares of common stock as to which Mr. Tuttle shares the power
to vote or to direct the vote, and to dispose or to direct the
disposition is none.
(c) Jack W. Peth
Within the past 60 days, Mr. Peth has not effected
any transactions in Issuer Common Stock.
Brian D. McNay
Within the past 60 days, Mr. McNay has not effected
any transactions in Issuer Common Stock.
Jeffrey Tuttle
Within the past 60 days, Mr. Tuttle has not effected
any transactions in Issuer Common Stock.
(d) Not applicable.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDING OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
Other than the Share Exchange Agreement, the Merger
Agreement, the Employment Agreements, and the Deferred
Compensation Agreement, to the knowledge of the Reporting
Persons, there are no contracts, arrangements, understandings
or relationships (legal or otherwise) among the persons named
in Item 2 and between such
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persons and any person with respect to any securities,
finder's fees, joint ventures, loan or option arrangements,
puts or calls, guarantees of profits, division of profits or
loss, or the giving or withholding of proxies.
ITEM 7. MATERIALS TO BE FILED AS EXHIBITS.
The following documents are filed as exhibits:
1. Joint Filing Agreement dated as of July 10, 2000 among the
Reporting Persons.
2. Plan and Agreement of Merger, dated as of July 7, 2000
between Business Resource Group and BRG Acquisition
Corporation.
3. Share Exchange Agreement, dated as of July 7, 2000 between
Brian D. McNay and BR Holdings, LLC.
4. Share Exchange Agreement, dated as of July 7, 2000 between
Jeffrey Tuttle and BR Holdings, LLC.
5. Employment Agreement, dated as of July 7, 2000 by and
between Jack W. Peth and BRG Acquisition Corporation.
6. Employment Agreement, dated as of July 7, 2000, by and
between Brian D. McNay and BRG Acquisition Corporation.
7. Employment Agreement, dated as of July 7, 2000, by and
between Jeffrey Tuttle and BRG Acquisition Corporation.
8. Form of Deferred Compensation Agreement, dated as of July
7, 2000, by and between BR Holdings LLC and Jack Peth.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: July 11, 2000
By: /s/ JACK W. PETH
---------------------------
Jack W. Peth
By: /s/ BRIAN D. MCNAY
---------------------------
Brian D. McNay
By: /s/ JEFFREY TUTTLE
---------------------------
Jeffrey Tuttle
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EXHIBIT INDEX
Exhibit Description of Exhibit
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1. Joint Filing Agreement dated as of July 10, 2000 among the
Reporting Persons.
2. Plan and Agreement of Merger, dated as of July 7, 2000 between
Business Resource Group and BRG Acquisition Corporation.
3. Share Exchange Agreement, dated as of July 7, 2000 between
Brian D. McNay and BR Holdings, LLC.
4. Share Exchange Agreement, dated as of July 7, 2000 between
Jeffrey Tuttle and BR Holdings, LLC.
5. Employment Agreement, dated as of July 7, 2000 by and between
Jack W. Peth and BRG Acquisition Corporation.
6. Employment Agreement, dated as of July 7, 2000, by and between
Brian D. McNay and BRG Acquisition Corporation.
7. Employment Agreement, dated as of July 7, 2000, by and between
Jeffrey Tuttle and BRG Acquisition Corporation.
8. Deferred Compensation Agreement, dated as of July 7, 2000, by
and between BR Holdings LLC and Jack Peth.
-9-
