Cendant Corporation 8-K 07-26-2005
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
____________
Form
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
____________
Date
of Report (Date of earliest event reported) July
29, 2005 (July 26, 2005)
Cendant
Corporation
(Exact
name of Registrant as specified in its charter)
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Delaware
(State
or other jurisdiction of
incorporation)
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1-10308
(Commission
File No.)
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06-0918165
(I.R.S.
Employer Identification
Number)
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9
West 57th
Street
New
York, NY
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10019
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(Address
of principal executive
office)
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(Zip
Code)
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Registrant's
telephone number, including area code (212)
413-1800
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None
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(Former
name or former address if changed since last report)
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Check
the appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act
(17 CFR 240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act
(17 CFR 240.13e-4(c))
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Item
1.01
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Entry
into a Material Definitive
Agreement.
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Agreement
Providing for the Sale of the Marketing Services Division
On
July 26, 2005, we entered into a definitive agreement with two affiliates of
Apollo Management V, L.P. ("Apollo"), Affinity Acquisition Inc. (the
"purchaser") and Affinity Acquisition Holdings Inc. (the "parent"), providing
for the sale of our Marketing Services Division (“MSD”) to the purchaser for
approximately $1.83 billion.
The
agreement provides for the sale of Cendant Marketing Group, LLC and Cendant
International Holdings Limited to the purchaser for a purchase price of
approximately $1.7 billion of cash, net of estimated closing adjustments, plus
$125 million face value of newly issued preferred stock of the parent.
The purchase price is subject to reduction if MSD's EBITDA for the last twelve
months prior to closing is less than a set threshold. The proportional amount
of
preferred stock and cash are subject to adjustment if the ratio of equity in
the
purchaser to preferred stock issued to us falls below a set
threshold.
In
addition, Cendant will receive warrants to purchase up to 7.5 percent of the
common equity of the parent, which will become exercisable upon the earlier
of
four years or the achievement by Apollo of certain investment return
hurdles.
The
purchase agreement contains customary representations, warranties, covenants
and
agreements of Cendant, the purchaser and the parent.
Cendant
will remain a marketing partner and a provider of travel services to MSD through
a number of commercial agreements to be executed at closing. Cendant has
retained liability for certain existing litigation matters, and also has agreed
to provide a limited indemnity to the purchaser with respect to certain existing
obligations of MSD, certain legal proceedings and any breaches of
representations and warranties (which generally survive until April 15, 2007)
and covenants contained in the purchase agreement.
The
transaction is subject to certain closing conditions, including the purchaser's
receipt of financing, receipt of insurance and other regulatory approvals,
the
absence of a material adverse effect on MSD and other customary closing
conditions, and is expected to be completed in the fall. The purchaser has
obtained equity and debt financing commitments for the transactions contemplated
by the purchase agreement, which are subject to customary
conditions.
The
purchase agreement may be terminated in certain limited circumstances, including
upon the failure of the closing of the transaction to occur on or before
December 26, 2005.
A
copy of the press release announcing that we had entered into the purchase
agreement is attached as Exhibit 99.1 and is incorporated by reference herein.
Director
Fees
On
July 26, 2005, Cendant’s Board of Directors approved an increase in the fees
paid to Cendant’s non-employee directors effective with the third quarter Board
compensation payment. As a result, the annual compensation for Cendant’s audit
committee chair, audit committee members and compensation committee chair will
be increased to $30,000, $20,000 and $25,000, respectively.
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Item
8.01
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Other
Information
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On
July
28, 2005, we announced that our Executive Vice President & Treasurer, David
B. Wyshner, has been promoted to vice chairman and chief financial officer
of our Travel Content Division (TCD), reporting to TCD Chairman and Chief
Executive Officer, Stephen P. Holmes. Mr. Wyshner will transition into this
new
role during the summer, and we expect to fill the treasurer post during this
period.
Cendant's
Travel Content Division includes our Avis and Budget vehicle rental operations,
our RCI timeshare exchange company, franchised lodging brands such as Ramada
and
Days Inn, a leading marketer of vacation rental properties in Europe, and
the
largest timeshare sales and development business in the United States. Mr.
Wyshner will be responsible for coordinating all of the division's financial
activities, with oversight of the division's controllers; its mergers and
acquisitions strategy and execution; and customer contact centers. In addition,
he will play an integral role in helping to manage the day-to-day operations
of
the division.
A
copy of
the press release announcing Mr. Wyshner's new post is attached as Exhibit
99.2
and is incorporated by reference herein.
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Item
9.01
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Financial
Statements and Exhibits.
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Exhibit
No.
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Description
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99.1
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Press
Release dated July 26, 2005.
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99.2
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Press
Release dated July 28, 2005. |
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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CENDANT CORPORATION
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By:
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/s/
Eric J. Bock
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Eric
J. Bock
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Executive
Vice President, Law and Corporate
Secretary
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Date:
July 29, 2005
EXHIBIT
INDEX
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Exhibit
No.
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Description
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99.1
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Press
Release dated July 26, 2005.
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99.2
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Press
Release dated July 28, 2005. |