SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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Form 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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May 14, 1997 (April 30, 1997)
(Date of Report (date of earliest event reported))
HFS Incorporated
(Exact name of Registrant as specified in its charter)
Delaware 1-11402 22-3059335
(State or other jurisdiction Commission File No.) (I.R.S. Employer
of incorporation or organization) Identification Number)
6 Sylvan Way
Parsippany, New Jersey 07054
(Address of principal executive office) (Zip Code)
(201) 428-9700
(Registrant's telephone number, including area code)
None
(Former name, former address and former fiscal year, if applicable)
Item 2.
Pursuant to a merger agreement (the "Merger Agreement") by and among HFS
Incorporated (the "Company"), Mercury Acq. Corp. ("Mercury") , a wholly owned
subsidiary of the Company and PHH Corporation ("PHH"), effective April 30, 1997,
Mercury was merged with and into PHH, with PHH being the surviving corporation
(the "Merger"), resulting in PHH becoming a wholly-owned subsidiary of the
Company. The Merger was completed upon receiving stockholder approval from the
respective stockholders of the Company and PHH at meetings of stockholders held
on April 30, 1997. In connection with the Merger, the Company issued
approximately 30.3 million shares of its common stock, valued at approximately
$1.8 billion, in exchange for all of the outstanding shares of PHH common stock,
and certain options to purchase PHH common stock issued to holders of PHH
employee stock options (the "PHH Options"). The 30.3 million shares of Company
common stock represent 19.2% of the total outstanding shares of the Company.
Pursuant to the Merger Agreement, the number of Company shares issued to
complete the Merger was determined by multiplying the outstanding shares of PHH
as of April 30, 1997 by the conversion number of .825, calculated in accordance
with the terms of the Merger Agreement, plus .7 million shares of Company common
stock issued in exchange for the PHH options. The Merger was accounted for as a
pooling of interests.
In connection with the Merger, the Company's Board of Directors elected
Robert D. Kunisch, current PHH Chairman and CEO, as a member of the Board of
Directors effective April 30, 1997. In addition, Mr. Kunisch was named a Vice
Chairman of the Company.
PHH, as a wholly owned subsidiary of the Company, will remain a registrant,
subject to the reporting requirements of the Securities Exchange Act of 1934, in
connection with its publicly offered debt securities.
PHH provides a broad range of integrated management services, expense
management programs and mortgage banking services to more than 3,000 major
clients, including many of the world's largest corporations, as well as
government agencies and affinity groups. Its primary business segments consist
of fleet management services, real estate services and mortgage banking
services. PHH is the world's largest provider of corporate relocation services.
The description contained herein of the Merger Agreement is qualified in its
entirety by reference to the Agreement and Plan of Merger dated as of November
10, 1996, by and among the Company, Mercury and PHH, a copy of which is attached
as Exhibit 2.1 to a Current Report on Form 8-K previously filed by the Company
with the Securities and Exchange Commission on November 15, 1996, as amended by
the Form 8-K/A dated December 4, 1996 and as further amended by the Form 8-K/A
dated March 27, 1997).
Item 7. Financial Statements, pro forma financial information and exhibits
a) Financial statements of business acquired:
1. The audited consolidated balance sheets of PHH Corporation and
subsidiaries as of April 30, 1996 and 1995 and the related
consolidated statements of income, stockholders' equity and cash
flows for each of the years in the three year period ended April
30, 1996 are incorporated herein by reference to the Company's
Current Report on Form 8-K dated November 15, 1996 (as amended by
the Form 8-K/A dated December 4, 1996 and as further amended by
the Form 8-K/A dated March 27, 1997).
2. The unaudited interim consolidated financial statements of PHH
Corporation as of January 31, 1997 and for the nine months ended
January 31, 1997 and 1996 are included in the PHH Quarterly
Report on Form 10-Q for the quarter ended January 31, 1997 (as
amended by the Form 10-Q/A filed on March 27, 1997) are
incorporated herein and attached hereto as Exhibit 99.1
b) Pro forma financial information:
1. The Company expects to file within 60 days from the date hereof,
the following pro forma information:
A) Pro forma combining consolidated financial statements of the
Company for the Merger as of March 31, 1997 and for the three
months ended March 31, 1997 and 1996 and for the year ended
December 31, 1996.
B) Consolidated historical financial statements of the Company as
restated for the pooling with PHH as of December 31, 1996 and
1995 and each of the years in the three year period ended
December 31, 1996.
c) Exhibits:
Exhibit
No. Description
23.1 Consent of KPMG Peat Marwick LLP
99.1 PHH Corporation Quarterly Report on Form 10-Q for the quarter ended
January 31, 1997 (as amended by the Form 10-Q/A filed on March 31,
1997).
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SIGNATURES
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.
HFS INCORPORATED
By: /s/ James E. Buckman
James E. Buckman
Senior Executive Vice President
and General Counsel
Date: May 14, 1997
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HFS INCORPORATED
CURRENT REPORT ON FORM 8-K
Report Dated May 14, 1997 (April 30, 1997)
EXHIBIT INDEX
Exhibit No. Description Page No.
23.1 Consent of KPMG Peat Marwick LLP
99.1 PHH Corporation Quarterly Report on Form 10-Q for the quarter ended
January 31, 1997 (as amended by the Form 10-Q/A filed on March 31,
1997).