SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE TO
TENDER OFFER STATEMENT
UNDER
SECTION 14(d)(1) OR 13(e)(1) OF
THE SECURITIES EXCHANGE ACT OF 1934
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CHEAP TICKETS, INC.
(Name of Subject Company (issuer))
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Diamondhead Acquisition Corporation
Cendant Corporation
(Name of Filing Persons (Offerors))
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Common Stock, par value $0.001 per Share
(Titles of Classes of Securities)
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151310
(CUSIP Number of Class of Securities)
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James E. Buckman, Esq.
Vice Chairman and General Counsel
Cendant Corporation
9 West 57th Street
New York, New York 10019
(212) 413-1800
(Name, address and telephone number of person authorized to receive notices and
communications on behalf of the filing person)
Copies to:
Kenton J. King, Esq. Eric J. Bock
kadden,SArps, Slate, Meagher & Flom LLP Senior Vice President, Legal
525 University Ave., Ste. 1100 Cendant Corporation
Palo Alto, California 94301 9 West 57th Street
(650) 470-4500 New York, New York 10019
(212) 413-1800
CALCULATION OF FILING FEE
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Transaction Valuation* Amount of Filing Fee**
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$406,241,791 $81,249
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* Estimated for purposes of calculating the filing fee only. This calculation
assumes the purchase of 23,299,413 shares of common stock of Cheap Tickets,
Inc. at the tender offer price of $16.50 per share of common stock. The
transaction value also includes the offer price of $16.50 less $11.16, which
is the average exercise price of outstanding options, multiplied by
2,652,698, the estimated number of options outstanding. The transaction
value further includes the offer price of $16.50 less $11.805, which is the
exercise price of outstanding warrants, multiplied by 1,626,426, the number
of warrants outstanding.
** The amount of the filing fee, calculated in accordance with Rule 0-11 of the
Securities Exchange Act of 1934, as amended, equals 1/50 of 1% of the
transaction valuation.
[_]Check the box if any part of the fee is offset as provided by Rule 0-
11(a)(2) and identify the filing with which the offsetting fee was
previously paid. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
Amount Previously Paid: _________________ Filing Party:____________________________
Form or Registration No.: _______________ Date Filed:______________________________
[_]Check the box if the filing relates solely to preliminary communications
made before the commencement of a tender offer.
Check the appropriate boxes below to designate any transactions to which the
statement relates:
[X]third-party tender offer subject to Rule 14d-1.
[_]issuer tender offer subject to Rule 13e-4.
[_]going-private transaction subject to Rule 13e-3.
[_]amendment to Schedule 13D under Rule 13d-2.
Check the following box if the filing is a final amendment reporting the
results of the tender offer: [_]
This Tender Offer Statement on Schedule TO (this "Schedule TO") relates to
the offer by Diamondhead Merger Corporation, a Delaware corporation (the
"Purchaser") and a wholly owned subsidiary of Cendant Corporation, a Delaware
corporation ("Cendant" or "Parent"), to purchase all the outstanding shares of
common stock, par value $0.001 per share, of Cheap Tickets, Inc., a Delaware
corporation ("Cheap Tickets" or the "Company"), at a purchase price of $16.50
per share, net to the seller in cash, without interest thereon, upon the terms
and subject to the conditions set forth in the Offer to Purchase dated August
23, 2001 (the "Offer to Purchase"), and in the related Letter of Transmittal,
copies of which are filed with this Schedule TO as Exhibits (a)(1)(A) and
(a)(1)(C) respectively. This Schedule TO is being filed on behalf of Purchaser
and Cendant.
The information set forth in the Offer to Purchase, including the Schedule
thereto, is hereby incorporated by reference in answer to items 1 through 11 of
this Schedule TO, and is supplemented by the information specifically provided
herein.
ITEM 1. SUMMARY TERM SHEET
The information set forth in the "Summary Term Sheet" of the Offer to
Purchase is incorporated herein by reference.
ITEM 2. SUBJECT COMPANY INFORMATION
(a) The name of the subject company is Cheap Tickets, Inc., a Delaware
corporation. The Company's principal executive offices are located at 1440
Kapiolani Blvd., Honolulu, Hawaii 96814. The Company's telephone number is
(808) 945-7439.
(b) This statement relates to Cheap Tickets' shares of common stock, par
value $0.001 per share, of which there were 23,299,413 issued and outstanding
as of August 13, 2001. The information set forth in the "Introduction" of the
Offer to Purchase is incorporated herein by reference.
(c) The information set forth in Section 6 of the Offer to Purchase entitled
"Price Range of Shares; Dividend on the Shares" is incorporated herein by
reference.
ITEM 3. IDENTITY AND BACKGROUND OF FILING PERSON
(a) This Schedule TO is filed by the Purchaser and Cendant. The information
set forth in Section 9 of the Offer to Purchase entitled "Certain Information
Concerning Parent and the Purchaser" is incorporated herein by reference.
(b) The information set forth in Section 9 of the Offer to Purchase entitled
"Certain Information Concerning Parent and the Purchaser" is incorporated
herein by reference.
(c) The information set forth in Section 9 of the Offer to Purchase entitled
"Certain Information Concerning Parent and the Purchaser" is incorporated
herein by reference. Except as set forth below, during the last five years,
none of the Purchaser or Cendant or, to the best knowledge of the Purchaser or
Cendant, any of the persons listed on Schedule I to the Offer to Purchase (i)
has been convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors) or (ii) was a party to any judicial or administrative
proceeding (except for matters that were dismissed without sanction or
settlement) that resulting in a judgment, decree or final order enjoining the
person from future violations of, or prohibiting activities subject to, federal
or state securities laws, or finding of any violation of such laws.
On June 14, 2000, the Securities and Exchange Commission (the "SEC")
instituted and simultaneously settled an administrative proceeding,
Administrative Proceeding File No. 3-10225, against Cendant in connection with
certain accounting irregularities at the former CUC International, Inc., which
merged with HFS Incorporated in December 1997 to form Cendant. The SEC found
that, as a result of such accounting irregularities, Cendant violated the
periodic reporting, corporate record-keeping and internal controls provisions
of the federal securities laws. Without admitting or denying the findings
contained in the SEC's administrative
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order, Cendant consented to the issuance of an SEC order directing Cendant to
cease and desist from committing or causing any violation, and any future
violation, of the periodic reporting, corporate record-keeping and internal
controls provisions of the federal securities laws. No financial penalties were
imposed against Cendant.
ITEM 4. TERMS OF THE TRANSACTION
The information set forth in the Offer to Purchase is incorporated herein by
reference.
ITEM 5. PAST CONTRACTS, TRANSACTIONS, NEGOTIATIONS AND AGREEMENTS.
The information set forth in Sections 9, 11, 12 and 13 of the Offer to
Purchase entitled "Certain Information Regarding Parent and the Purchaser,"
"Background of the Offer," "Purpose of the Offer; Plans for the Company" and
"The Merger Agreement and the Stockholder Agreement," respectively, is
incorporated herein by reference. Except as set forth therein, there have been
no material contacts, negotiations or transactions during the past two (2)
years which would be required to be disclosed under this Item 5 between any of
the Purchaser or Cendant or any of their respective subsidiaries or, to the
best knowledge of Purchaser or Cendant, any of those persons listed on Schedule
I to the Offer to Purchase, on the one hand, and the Company or its affiliates,
on the other, concerning a merger, consolidation or acquisition, a tender offer
or other acquisition of securities, an election of directors or sale or
transfer of a material amount of assets.
ITEM 6. PURPOSE OF THIS TRANSACTION AND PLANS OR PROPOSALS.
(a),(c)(1-7) The information set forth in the "Introduction" and Sections 12
and 13 of the Offer to Purchase entitled "Purpose of the Offer; Plans for the
Company," and "The Merger Agreement and the Stockholder Agreement," and,
respectively, is incorporated herein by reference.
ITEM 7. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
The information set forth in Section 10 of the Offer to Purchase entitled
"Source and Amount of Funds" is incorporated herein by reference.
ITEM 8. INTEREST IN SECURITIES OF THE COMPANY.
The information set forth in the "Introduction" and Sections 5, 9, 11 and 13
of the Offer to Purchase entitled "Certain Information Concerning Parent and
the Purchaser," "Background of the Offer" and "The Merger Agreement and the
Stockholder Agreement," respectively, is incorporated herein by reference.
ITEM 9. PERSONS/ASSETS RETAINED, EMPLOYED, COMPENSATED OR USED.
The information set forth in the "Introduction" and Section 16 of the Offer
to Purchase entitled "Fees and Expenses" is incorporated herein by reference.
ITEM 10. FINANCIAL STATEMENTS.
Not applicable.
ITEM 11. ADDITIONAL INFORMATION
The information set forth in Sections 11, 13 and 16 of the Offer to Purchase
entitled "Background of the Offer," "The Merger Agreement and the Stockholder
Agreement" and "Fees and Expenses," respectively, is incorporated herein by
reference.
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ITEM 12. EXHIBITS
(a)(1)(A) Offer to Purchase dated August 23, 2001.
(a)(1)(B) Letter of Transmittal.
(a)(1)(C) Notice of Guaranteed Delivery.
(a)(1)(D) Letter to Brokers, Dealers, Banks, Trust Companies and other
Nominees.
(a)(1)(E) Letter to Clients for use by Brokers, Dealers, Banks, Trust
Companies and other Nominees.
(a)(1)(F) Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9
(a)(1)(G) Press Release issued by Cendant on August 23, 2001.
Summary Advertisement published in the Wall Street Journal on
(a)(1)(I) August 23, 2001.
(a)(1)(J) Letter to Stockholders from President and Chief Executive Officer
of Cheap Tickets dated August 23, 2001.
(b) Not applicable.
(d)(1) Agreement and Plan of Merger dated as of August 13, 2001, among
Cendant, Purchaser and Cheap Tickets.
(d)(2) Stockholder Agreement dated as of August 13, 2001 by and among
Cendant, Purchaser, Cheap Tickets and Stockholders.
(d)(3) Confidentiality Agreement, dated May 24, 2001, as amended on July
3, 2001 and August 11, 2001, between Cheap Tickets and Cendant
Internet Group, Inc.
(g) Not applicable.
(h) Not applicable.
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SIGNATURES
After due 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.
DIAMONDHEAD ACQUISITION CORPORATION
/s/ Eric J. Bock
By: _________________________________
Name: Eric J. Bock
Title: Senior Vice President and
Secretary
CENDANT CORPORATION
/s/ Eric J. Bock
By: _________________________________
Name: Eric J. Bock
Title: Senior Vice President, Law
and Corporate Secretary
Date: August 23, 2001
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INDEX TO EXHIBITS
Exhibit
Number Document
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(a)(1)(A) Offer to Purchase dated August 23, 2001.
(a)(1)(B) Letter of Transmittal.
(a)(1)(C) Notice of Guaranteed Delivery.
(a)(1)(D) Letter to Brokers, Dealers, Banks, Trust Companies and other
Nominees.
(a)(1)(E) Letter to Clients for use by Brokers, Dealers, Banks, Trust
Companies and other Nominees.
(a)(1)(F) Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9
(a)(1)(G) Press Release issued by Cendant on August 23, 2001.
(a)(1)(I) Summary Advertisement published in the Wall Street Journal on August
23, 2001.
(a)(1)(J) Letter to Stockholders from President and Chief Executive Officer of
Cheap Tickets dated August 23, 2001.
(b) Not applicable.
(d)(1) Agreement and Plan of Merger dated as of August 13, 2001, among
Cendant, Purchaser and Cheap Tickets.
(d)(2) Stockholder Agreement dated as of August 13, 2001 by and among
Cendant, Purchaser, Cheap Tickets and Stockholders.
(d)(3) Confidentiality Agreement, dated May 24, 2001, as amended on July 3,
2001 and August 11, 2001, between Cheap Tickets and Cendant
Internet Group, Inc.
(g) Not applicable.
(h) Not applicable.
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