RURAL/METRO CORP /DE/

The Company, each member of the Board of Directors, Warburg, Parent, and Merger Sub are named as defendants in purported class action lawsuits brought by alleged stockholders of the Company challenging the Company’s proposed merger with Parent. The stockholder actions were filed in the Court of Chancery of the State of Delaware (Llorens v. Rural/Metro Corporation, et al., filed April 6, 2011) and in the Superior Court of the State of Arizona, County of Maricopa (Joanna Jervis v. Rural/Metro Corporation, et al., filed April 6, 2011). Robert E. Wilson, a former member of the Board of Directors, is also named as a defendant in the Llorens stockholder action. The stockholder actions allege, among other things, that the members of the Board of Directors breached their fiduciary duties owed to the Company’s public stockholders and were aided and abetted by certain of the defendants, and seek, among other things, to enjoin the defendants from completing the merger on the agreed-upon terms.

Joanna Jervis v. Rural/Metro Corporation, et al. was filed in the Superior Court of the State of Arizona, County of Maricopa on April 6, 2011 and amended on April 14, 2011 to add Warburg, Parent and Merger Sub as defendants. The stockholder action alleges, among other things, that (i) each individual defendant breached his fiduciary duties to the stockholders of the Company, including duties of care, loyalty, good faith, candor and independence owed to the stockholders of the Company, by, among other things, authorizing the sale of the Company to Parent, and, in doing so, failing to take steps to maximize the value of the Company to its stockholders, and (ii) Warburg, Parent, Merger Sub and the Company aided and abetted the breaches of fiduciary duty allegedly committed by the individual defendants. The stockholder action seeks equitable relief, including a judgment enjoining the defendants from consummating the merger on the agreed-upon terms, rescission of the merger to the extent implemented and a direction that the defendants exercise their fiduciary duties to obtain a transaction which is in the best interests of stockholders of the Company until the process for the sale or auction of the Company is completed and the highest possible value is obtained, and attorneys’ fees and costs.

On April 25, 2011, a report was issued by the San Diego City Auditor’s Office regarding claims against the Company and San Diego Medical Services Enterprise LLC (“SDMSE”), a joint venture entity managed by the Company and the City of San Diego, California (the “City”) that provides emergency and non-emergency medical transport services to the City. The report focuses primarily on the accounting for SDMSE reimbursements and fees paid to the Company and recommends, among other things, that SDMSE’s revenues and expenses be reviewed to ensure that they were proper and that reimbursements to the Company were appropriate. The Office of the San Diego City Attorney has advised the Company that it is required to respond to the City Auditor’s report, and the Company intends to lend its full cooperation and support. The Company serves as SDMSE’s financial administrator and is confident in the accounting practices relating to SDMSE. To facilitate a timely resolution, the Company and the City have entered into an interim

The Merger Agreement and this summary of certain of its terms have been provided solely to inform investors of its terms. The representations, warranties and covenants contained in the Merger Agreement were made only for the purposes of such agreement and as of specific dates, were made solely for the benefit of the parties to the Merger Agreement and may be intended not as statements of fact, but rather as a way of allocating risk to one of the parties if those statements prove inaccurate. In addition, such representations, warranties and covenants may have been qualified by certain disclosures not reflected in the text of the Merger Agreement and may apply standards of materiality in a way that is different from what may be viewed as material by shareholders of, or other investors in, Rural/Metro. Our shareholders and other investors are not third-party beneficiaries under the Merger Agreement and should not rely on the representations, warranties and covenants or any descriptions thereof as a characterization of the actual state of facts or conditions of Rural/Metro, Parent, Merger Sub or any of their respective subsidiaries or affiliates.

On March 28, 2011, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with WP Rocket Holdings LLC, a Delaware limited liability company (“Parent”), and WP Rocket Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”). Merger Sub and Parent are affiliates of Warburg Pincus LLC (“Warburg”) formed by Warburg in order to acquire the Company. The Merger Agreement provides for the merger of Merger Sub with and into the Company (the “Merger”), with the Company surviving the Merger as a wholly owned subsidiary of Parent. There are a number of risks and uncertainties relating to the Merger. For example, the Merger may not be consummated or may not be consummated in the timeframe or manner currently anticipated, as a result of several factors, including, among other things, the failure of one or more of the Merger Agreement’s closing conditions, the failure of Parent and Merger Sub to obtain the necessary financing arrangements set forth in the commitment letters received in connection with the Merger, or litigation relating to the Merger. In addition, there can be no assurance that approval of our stockholders or relevant regulators will be obtained, that the other conditions to closing of the Merger will be satisfied or waived or that other events will not intervene to delay or result in the termination of the Merger. If the Merger is not completed, the price of our common stock may change to the extent that the current market price of our common stock reflects an assumption that the Merger will be consummated. Pending the closing of the Merger, the Merger Agreement also restricts us from engaging in certain actions without Parent’s consent, which could prevent us from pursuing opportunities that may arise prior to the closing of the Merger. Any delay in closing or a failure to close could have a negative impact on our business and stock price as well as our relationships with our customers, vendors or employees, as well as a negative impact on our ability to pursue alternative strategic transactions and/or our ability to implement alternative business plans. In addition, if the Merger Agreement is terminated under certain circumstances, we are required to pay a termination fee of approximately $17.0 million.