PROSPECTUS
AMERTRANZ WORLDWIDE HOLDING CORP.
3,627,836 Shares of Common Stock, Par Value $.01 per Share
1,586,783 Redeemable Common Stock Purchase Warrants
This Prospectus relates to the issuance by the Company of 2,300,000 shares of
Common Stock ("Common Stock") issuable upon exercise of 2,300,000 Redeemable
Common Stock Purchase Warrants ("Warrants") issued by Amertranz Worldwide
Holding Corp. ("Company") in its initial public offering in June 1996. This
Prospectus also relates to the future resale by certain persons ("Selling
Securityholders") of (i) 1,127,836 shares of Common Stock and 1,386,783 Warrants
issued in various private financings prior to the Company's June 1996 initial
public offering, and (ii) 200,000 shares of Common Stock and 200,000 Warrants
which may be issued upon exercise of the Underwriter's Purchase Option granted
in connection with the Company's June 1996 initial public offering. See "Selling
Securityholders".
Each Warrant entitles the holder to purchase one share of Common Stock for $6.00
at any time until June 27, 2001. In the event the Registration Statement of
which this Prospectus is a part is effective and current, and provided that not
less than 30 days' notice of redemption is given and the last sale date of the
Common Stock has been at least $10.00 for each of the 20 trading days ending on
the third business day prior to the day on which notice is given, the Company
has the right to call the Warrants for redemption at a redemption price of $.01
per Warrant.
Sale of the Securities may be effected from time to time in transactions (which
may include block transactions) on the Nasdaq SmallCap Market, in negotiated
transactions, or a combination of such methods of sale, at fixed prices which
may be changed, at market prices prevailing at the time of sale or at negotiated
prices. None of the Selling Securityholders has entered into agreements,
understandings or arrangements with any underwriters or broker-dealers regarding
the sale of their Shares. The Selling Securityholders may effect such
transactions by selling their shares of Common Stock and/or Warrants directly to
purchasers or to or through broker-dealers, which may act as agents or
principals. Such broker-dealers may receive compensation in the form of
discounts, concessions or commissions from the Selling Securityholders and/or
the purchasers of the Securities for whom such broker/dealers may act as agents
or to whom they sell as principals, or both (which compensation as to a
particular broker/dealer might be in excess of customary commissions). See "Plan
of Distribution".
On August 1, 1997, the last sale prices per share of Common Stock and per
Warrant, as reported by the Nasdaq SmallCap Market, were $1.375 and $0.375,
respectively.
The Selling Securityholders and any broker-dealers or agents that participate
with the Selling Securityholders in the distribution of the Securities may be
deemed to be "underwriters" within the meaning of Section 2(11) of the
Securities Act of 1933, as amended (the "Securities Act") and, as
"underwriters", may be liable for material omissions or misrepresentations in
this Prospectus. The Selling Securityholders may agree to indemnify any agent,
dealer, or broker-dealer that participates in transactions involving sales of
the securities against certain liabilities, including liabilities arising under
the Securities Act.
The Company will not receive any part of the proceeds from the sale of the
Securities; however, the Company will receive the exercise price of the Warrants
that are exercised. There is no assurance that any Warrants will be exercised
resulting in any proceeds to the Company.
The securities offered hereby are speculative in nature and involve a high
degree of risk and substantial dilution. See "Risk Factors" at page 4.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
NOR HAS THE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is August 13, 1997
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No dealer, salesperson or other person has been authorized to give any
information or to make any representations, other than those contained or
incorporated by reference in this Prospectus, in connection with the offering
contained herein and, if given or made, such information must not be relied upon
as having been authorized by the Company or the Selling Securityholders. This
Prospectus does not constitute an offer to sell or a solicitation of an offer to
buy any of the securities offered hereby in any jurisdiction to any person to
whom it is unlawful to make such offer in such jurisdiction. Neither the
delivery of this Prospectus nor any sale made hereunder shall under any
circumstances create any implication that there has been no change in the
affairs of the Company since the date hereof.
UNCERTAINTY OF FORWARD LOOKING STATEMENTS
This Prospectus, including any documents that are incorporated by
reference as set forth in "Available Information," contains forward looking
statements. Such statements are typically punctuated by words or phrases such as
"anticipate," "estimate," "projects," "should," "may," "management believes,"
and words or phrases of similar import. Such statements are subject to certain
risks, uncertainties or assumptions. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those anticipated, estimated or
projected. Among the key factors that may have a direct bearing on the Company's
results of operations and financial condition are: (i) the Company's recent
losses and ability to achieve profitability, (ii) competitive practices in the
industries in which the Company competes, (iii) the Company's dependence on
current management, (iv) the impact of current and future laws and governmental
regulations affecting the transportation industry in general and the Company's
operations in particular, and (v) general economic conditions. See "Risk
Factors."
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith, files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information filed by the Company can be inspected and
copied at the public reference facilities maintained by the Commission at 450
Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at the Commission's
Regional Offices at 7 World Trade Center, 13th Floor, New York, New York 10048,
and 500 West Madison Street, Suite 1400, Chicago, Illinois 60661, and copies may
be obtained at the prescribed rates from the Public Reference Section of the
Commission, 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549. The
Commission also maintains a Web site that contains reports, proxy statements and
other information regarding registrants that file electronically with the
Commission. The address of such site is http:\\www.sec.gov.
The Company has filed with the Commission a Registration Statement (the
"Registration Statement") on Form S-3 under the Securities Act of 1933, as
amended (the "Securities Act"), with respect to the Securities offered by this
Prospectus. This Prospectus, which constitutes part of the Registration
Statement, omits certain of the information contained in the Registration
Statement and the exhibits thereto on file with the Commission pursuant to the
Securities Act and the rules and regulations of the Commission thereunder. For
further information with respect to the Company and the Securities, reference is
made to the Registration Statement. Copies of the Registration Statement,
including all exhibits thereto, may be obtained from the Commission's principal
office in Washington, D.C. upon payment of the fees prescribed by the Commission
or may be examined without charge at the offices of the Commission or Web site
as described above.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents heretofore filed by the Company (File No.
001-14474) with the Commission are incorporated herein by reference:
(a) the Company's Annual Report on Form 10-K for the fiscal year
ended June 30, 1996, and amendments thereto, filed January
2, 1997 and August 12, 1997.
(b) the Company's Quarterly Reports on Form 10-Q for the
quarters ended September 30 and December 31, 1996, and March
31, 1997;
(c) amendment to the Company's Quarterly Report on Form 10-Q for
the quarter ended September 30, 1996, filed January 7, 1997;
(d) amendment to the Company's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1997, filed August 12, 1997;
(e) the Company's Current Report on Form 8-K dated October 10,
1996, and amendment thereto, filed November 26, 1996;
(f) the Company's Proxy Statement, filed with the Commission on
November 6, 1996;
(g) the Company's Information Statement, filed with the
Commission on June 20, 1997; and
(h) the description of the Common Stock and the warrants
included in the Company's Registration Statement on Form
8-A, dated June 17, 1996 and the information thereby
incorporated by reference contained in the Company's
Registration Statement on Form S-1, Registration No.
333-03613, dated June 28, 1996 are hereby incorporated by
reference into this Prospectus.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the termination of the offering made hereby shall be deemed to be
incorporated by reference into this Prospectus and to be part hereof from the
date of filing such documents. Any statement contained in a document all or a
portion of which is incorporated or deemed to be incorporated by reference
herein shall be deemed to be modified or superseded for purposes of the
Registration Statement and this Prospectus to the extent that a statement
contained in the Registration Statement, this Prospectus, or any other
subsequently filed document that is also incorporated by reference herein
modifies or supersedes that statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus.
The Company hereby undertakes to provide without charge to each person,
including any beneficial owner, to whom a Prospectus is delivered, upon written
or oral request of that person, a copy of any document incorporated herein by
reference (other than exhibits to those documents unless the exhibits are
specifically incorporated by reference into the documents that this Prospectus
incorporates by reference). Requests should be directed to the Secretary, 2001
Marcus Avenue, Lake Success, New York 11042, telephone number (516) 326-9000.
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THE COMPANY
The Company provides freight forwarding services through its wholly
owned subsidiaries, Amertranz Worldwide, Inc. ("Amertranz"), Caribbean Air
Services, Inc. ("CAS"), Consolidated Air Services, Inc. ("Consolidated Air") and
Target Airfreight, Inc. ("Target"). The Company has a network of offices in 17
cities throughout the United States and Puerto Rico, including exclusive agency
relationships in eight cities. The Company has international freight forwarding
operations consisting of strategic relationships in over 20 countries. The
Company believes that it is one of the dominant freight forwarders between the
continental United States and Puerto Rico.
The Company's freight forwarding services involve arranging for the
total transport of customers' freight from the shippers' location to the
designated recipients, including the preparation of shipping documents and the
providing of handling, packing and containerization services. The Company
concentrates on cargo shipments weighing more than 50 pounds and generally
requiring second-day delivery. The Company also assembles bulk cargo and
arranges for insurance.
The Company was incorporated in Delaware in January 1996 as the
successor to operations commenced in 1970. Unless otherwise expressly stated,
all references to the "Company" in this Prospectus include the Company,
Amertranz, CAS, Consolidated Air and Target. The Company's executive offices are
located at 2001 Marcus Avenue, Lake Success, New York 11042, and its telephone
number is (516) 326-9000.
RISK FACTORS
An investment in the Company is speculative and involves a high degree of risk,
and is not appropriate for persons who cannot afford the loss of their entire
investment. The following risk factors should be considered carefully in
addition to the other information in this Prospectus before purchasing the
Securities.
Substantial Losses; Accumulated Deficit. While the businesses of the
Company's CAS and Consolidated Air subsidiaries have generated positive cash
flows for several years, the business of the Company's Amertranz subsidiary has
incurred operating losses for each of its operating periods and continues to
incur losses. For the nine-months ended March 31, 1997, the Company, on a
consolidated basis, generated approximately $53.3 million in operating revenues,
and incurred operating losses of approximately $3.9 million. As of March 31,
1997, total stockholders' equity in the Company was $2,044,188, and excluding
intangible assets such as goodwill, the Company had a tangible net worth deficit
of $10,145,670. Because of continuing losses in the Company's Amertranz
subsidiary, the Company has commenced actions to close the operations of the
Amertranz subsidiary and transfer its customer accounts to the Company's other
subsidiaries for fair consideration. The Company will be unable to achieve and
sustain profitability unless it improves its operating results. There can be no
assurance that the Company will be able to increase revenues or achieve
profitability. See "Risk Factors -- Amertranz Subsidiary Losses" and "Recent
Developments -- Amertranz Subsidiary Losses".
Working Capital Deficit; Need for Additional Funding. As of the date
hereof, the Company's current liabilities exceed its current assets. Although
the CAS and Consolidated Air businesses have generated positive cash flow from
operations for the past three fiscal years, the cash flow from the operations of
the Amertranz business has not been sufficient to finance trade payables,
capital equipment requirements and new office expansion and development. As a
result, Amertranz has engaged in interim borrowing from various sources,
including the Company and its affiliates. The Company is currently
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negotiating with the trade creditors of the Amertranz subsidiary to allow
Amertranz to satisfy those obligations on a payment schedule based on existing
resources and cash generated from operations. There can be no assurance that the
Company will be successful in these negotiations. Although the Company
anticipates, based on current plans and assumptions relating to its operations,
that existing resources and cash generated from operations should be sufficient
to satisfy the Company's contemplated cash requirements for at least 12 months
after the date of this Prospectus, the Company expects that it will experience
periods of significant negative cash flow whether or not the Company succeeds in
restructuring the trade payables of the Amertranz subsidiary. After such
12-month period, the Company anticipates that cash generated from operations
will be sufficient to meet its capital requirements. However, there can be no
assurance that the Company will not require additional cash during or subsequent
to such 12-month period. The Company currently has no commitments from any
prospective lenders with respect to any such financing. The terms of the
Company's current borrowings substantially limit the Company's flexibility in
obtaining additional financing. There can be no assurance that any additional
financing will be available to the Company upon acceptable terms, if at all. The
inability to obtain additional financing if and when needed, would have a
material adverse effect on the Company's operating results. See "Risk Factors --
Amertranz Subsidiary Losses" and "Recent Developments -- Amertranz Subsidiary
Losses".
Amertranz Subsidiary Losses. While the businesses of the Company's CAS
and Consolidated Air subsidiaries have generated positive cash flows for several
years, the business of the Company's Amertranz subsidiary has incurred operating
losses for each of its operating periods. For the six months ended June 30, 1996
the Amertranz subsidiary incurred losses of $4,758,918, and for the nine months
ended March 31, 1997 the Amertranz subsidiary incurred losses of $5,252,688.
These losses in the Amertranz subsidiary have resulted in losses for the
Company, on a consolidated basis, of $6,396,524 for the six months ended June
30, 1996, and $3,928,463 for the nine months ended March 31, 1997. Because of
continuing losses in the Company's Amertranz subsidiary, the Company has
commenced actions to close the operations of the Amertranz subsidiary and
transfer its customer accounts to the Company's other subsidiaries for fair
consideration. The Company is currently negotiating with the trade creditors of
the Amertranz subsidiary to allow Amertranz to satisfy those obligations on a
payment schedule based on existing resources and cash generated from operations.
There can be no assurance that the Company will be successful in these
negotiations. In connection with the closing of the Amertranz subsidiary,
Amertranz has also incurred certain obligations to terminated employees. While
the Company projects that if it is successful in these negotiations with these
trade creditors, the closing of the Amertranz subsidiary will have a positive
affect on the Company's operations, there can be no assurance that the Company
will be successful in these negotiations, that the business of the Amertranz
subsidiary will be preserved and transferred to the Company's other operating
subsidiaries, or that the closing of Amertranz will produce positive operating
results. If the Company is not successful in these negotiations with these trade
creditors, or if the desired results are not achieved for the Amertranz
subsidiary, the continued losses in Amertranz could have a material adverse
effect on the Company's operating results, and the Company may consider other
options, including seeking protection for the Amertranz subsidiary under the
Bankruptcy Code. See "Recent Developments -- Amertranz Subsidiary Losses".
Pledge of Assets. Substantially all of the Company's assets are pledged
to secure its indebtedness. If one or more of the Company's secured creditors
foreclose upon its security interest in the Company's assets, such action would,
in all likelihood, result in the inability of the Company to continue in
business. The Company may also be required to obtain the consent of these
creditors in order to complete future financings, and there can be no assurance
that these consents would be forthcoming.
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Control of the Company by Principal Stockholders; Conflicts of
Interest. TIA, Inc. ("TIA") and Caribbean Freight System, Inc. ("CFS") together
own approximately 32% of the outstanding shares of the Company's Common Stock.
In addition, certain stockholders of the Company have given irrevocable proxies
to TIA and CFS to vote a portion or all of such stockholders' shares of Common
Stock until 2001 for the election of directors, and the proxy granted by one
such stockholder includes all matters submitted to stockholders for a vote. The
stock ownership of TIA and CFS, together with such proxies, allow TIA and CFS to
control 40.7% of the issued and outstanding shares of Common Stock. As a result,
TIA and CFS will be in a position to control the Company through their combined
ability to determine the outcome of elections of the Company's directors and to
prevail in matters submitted to a vote of stockholders. In addition, the Company
has significant outstanding indebtedness owed to TIA and CFS which is secured by
the Company's assets. The Company's indebtedness to TIA and CFS is subordinated
to the Company's obligations under its accounts receivable financing facility
with BNY Financial Corp. While, under Delaware corporate law, a majority
stockholder owes certain fiduciary duties to minority stockholders, there may be
circumstances in which these different relationships create material conflicts
of interest which TIA and CFS are under no obligation to resolve in favor of
other stockholders or the Company. Stuart Hettleman, a director and President of
the Company owns a non-controlling indirect minority interest in TIA and is an
executive officer of TIA and CFS. Richard A. Faieta, a director and Executive
Vice President of the Company is a non-controlling minority stockholder of TIA
and is an executive officer of TIA and CFS. The Company's officers and directors
owe a fiduciary duty to the Company and its shareholders to act in the best
interests of the Company and its shareholders. In the event of a conflict of
interest between the Company and TIA and CFS, Messrs. Hettleman and Faieta will
act on behalf of the Company and will abstain from taking any action on behalf
of TIA and CFS.
Delay in Payment of Trade Creditors. In order to manage its working
capital resources, the Amertranz subsidiary has in the past and is currently
paying many of its trade creditors and service providers at rates slower than
provided in their respective invoices or agreements. Failure to pay these trade
creditors in a timely fashion has in the past adversely affected and in the
future could adversely affect, the Company's relationships with these trade
creditors or result in a default under its agreements with such trade creditors.
Competition. The Company competes with a large number of firms, many of
which have facilities and financial resources far greater than the Company.
Competition within the freight industry is intense. In the freight forwarding
industry, the Company competes with a large and diverse group of national
freight forwarding concerns, commercial air and ocean carriers and a large
number of locally established companies in geographic areas where the Company
does business or intends to do business in the future. Insofar as inter-city
trucking is a portion of the Company's method of freight transport, the Company
competes with a large number of long-haul, medium-haul, truckload and less than
truckload carriers, and railroads. While the Company does not consider itself to
be competing with traditional small package delivery services such as Federal
Express Corporation, United Parcel Service of America, Inc., Airborne Freight
Corporation and DHL Worldwide Express, Inc., in the event that any of these
established businesses, with their goodwill, name, resources and trade
recognition, decide to expand into the heavy freight business, such
circumstances could have a material adverse effect upon the business of the
Company.
Expansion of Business. The Company has grown through acquisitions of
other freight forwarders and intends to continue its program of business
expansion through acquisitions. There can be no assurance that its financial
condition will be sufficient to support the funding needs of an expansion
program, that acquisitions will be successfully consummated or will enhance
profitability, or that any expansion
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opportunities will be available upon reasonable terms. Past acquisitions by the
Company as well as future acquisitions have risks commonly encountered in
acquisitions of businesses. Such risks include, among other things, the
difficulty of assimilating the operations and personnel of the acquired
businesses, the potential disruption of the Company's ongoing business, the
inability of management to realize the projected operational and financial
benefits from the acquisition or to maximize the financial and strategic
position of the Company through the successful incorporation of acquired
personnel and clients, the maintenance of uniform standards, controls,
procedures and policies and the impairment of relationships with employees and
clients as a result of any integration of new management personnel. The Company
expects that future acquisitions, if any, could provide for consideration to be
paid in cash, stock or a combination of cash and stock. There can be no
assurance that any of these acquisitions will be accomplished. If an entity is
acquired by the Company and such entity is not efficiently or completely
integrated with the Company, then the Company's business, financial condition
and operating results could be materially adversely affected.
Dependence on Key Personnel. The Company believes that its future
success will be highly dependent upon its ability to attract and retain skilled
managers, salespersons, and other personnel. The inability to attract and retain
such managers and personnel could have a material adverse effect on the
Company's operating results. In addition, the Company believes that its success
will depend to a significant extent on the efforts and abilities of its senior
management, in particular those of Stuart Hettleman, President and Chief
Executive Officer of the Company, and Richard A. Faieta, Executive Vice
President of the Company. Although the Company has entered into an employment
agreement with each of Messrs. Hettleman and Faieta which expire in June 1999,
the loss of the services of either Mr. Hettleman or Mr. Faieta could have a
material adverse effect on the Company's operating results. Currently there is
no "key person" life insurance in place for Messrs. Hettleman and Faieta.
However the Company intends to obtain such insurance policies in the amount of
$1 million on each of their lives.
Potential Reduction of Business in Puerto Rico. There are significant
United States income tax benefits available to United States mainland companies
engaging in business in Puerto Rico. The CAS business historically has derived
substantial operating revenues from such companies. Therefore, the profitability
of the Company's CAS business is largely dependent on such customers. On a
historic basis the approximate amount and percentage of the Company's total
operating revenue derived from such business was $33.5 million or 83% in
calendar 1993, $39.6 million or 69% in calendar 1994, $39.2 million or 63% in
calendar 1995 and $36.9 million or 57.5% in calendar 1996. Congress reduced
these benefits in 1993, and legislation enacted in 1996 contains a 10-year
phaseout of these tax benefits. This legislation, or in the event that there is
any further modification to these tax benefits available to United States
companies doing business in Puerto Rico, could result in those companies
reducing the level of the business which they had been doing in Puerto Rico,
which would have a material adverse effect upon the Company's operating results.
Dependence on Carriers; Inability to Control Transportation Facilities.
The Company does not own or operate any trucks, nor does it own or operate any
aircraft (although it will have certain exclusive rights to the use of an L-1011
aircraft in connection with its CAS business until June 1998) for the movement
of either domestic or international freight. The Company does not have any
present or anticipated future plans to acquire, by lease or otherwise, or own or
operate any freight transportation equipment. The Company's ability to service
its customers depends on the availability of space on air passenger and cargo
airlines and trucking carriers. The quality and timeliness of the Company's
freight forwarding services will be dependent upon the services of these
independent contractors, over which the Company has no control. Shortages of
freight space are most likely to develop around holidays and on
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routes upon which traffic is especially heavy. Furthermore, the Company will be
competing with others for the availability and utilization of freight space. In
addition, available air cargo space on passenger airlines could be reduced as a
result of changes in the types of aircraft or decreases in the number of
passenger airlines serving particular routes at particular times, which could
occur as a result of economic conditions and other factors beyond the control of
the Company. While the Company has not experienced shortages of freight space in
the past, significant shortages of suitable space in the future, if any, and
associated increases in rates charged by carriers could have a material adverse
affect on the Company's future operating results.
Vulnerability to Economic Conditions. The Company's future operating
results are dependent upon the economic environments in which it operates.
Demand for the Company's services could be adversely affected by economic
conditions in the industries of the Company's customers. A number of the
principal customers of the Company's business are in the fashion, computer,
electronics and pharmaceutical industries. Adverse conditions in any of these
industries or loss of the major customers in such industries could have a
material adverse impact upon the Company. The Company expects the demand for its
services (and consequently its results of operations) to continue to be
sensitive to domestic and, increasingly, global economic conditions and other
factors beyond its control. In addition, the transport of freight, both
domestically and internationally, is highly competitive and price sensitive.
Changes in the volume of freight transported, shippers preferences as to the
timing of deliveries as a means to control shipping costs, economic and
political conditions, both in the United States and abroad, work stoppages,
United States and foreign laws relating to tariffs, trade restrictions, foreign
investments and taxation may all have significant impact on the overall business
of the Company, its growth and profitability.
Dividends Unlikely. The Company has never declared or paid dividends on
its Common Stock and does not intend to pay dividends in the foreseeable future.
The payment of dividends in the future will be at the discretion of the Board of
Directors.
Regulatory Compliance. The Company's freight forwarding business as an
indirect air cargo carrier is subject to regulation by the United States
Department of Transportation (DOT) under the Federal Aviation Act. However, air
freight forwarders (including the Company) are exempted from most of such Act's
requirements by the Economic Aviation Regulations promulgated thereunder. The
Company's foreign air freight forwarding operations are subject to regulation by
the regulatory authorities of the respective foreign jurisdictions. The air
freight forwarding industry is subject to regulatory and legislative changes
which can affect the economics of the industry by requiring changes in operating
practices or influencing the demand for, and the costs of providing, services to
customers. The Company does not believe that costs of regulatory compliance have
had a material adverse impact on its operations to date. However, failure of the
Company to comply with any applicable regulations could have an adverse effect
on the Company. There can be no assurance that the adoption of future
regulations would not have a material adverse effect on the Company's business.
Current Prospectus and State Blue Sky Registration Required to Exercise
Warrants. The Company will be able to issue shares of its Common Stock upon
exercise of the Warrants only if there is then a current prospectus relating to
such shares of Common Stock and only if such shares of Common Stock are
qualified for sale or exempt from qualification under applicable state
securities laws of the jurisdictions in which the various holders of the
Warrants reside. The Company has undertaken and intends to file and keep current
a prospectus which will permit the purchase and sale of the shares of Common
Stock underlying the Warrants, but there can be no assurance that the Company
will be able to
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do so. Although the Company intends to seek to qualify for sale the shares of
Common Stock underlying the Warrants in those states in which the securities are
to be offered, no assurance can be given that such qualification will occur. The
Warrants may be deprived of any value and the market for the Warrants may be
limited if a current prospectus covering the shares of Common Stock issuable
upon exercise of the Warrants is not kept effective or if such shares of Common
Stock are not qualified or exempt from qualification in the jurisdictions in
which the holders of the Warrants then reside. See "Description of
Securities--Warrants".
Effect of Outstanding Rights, Options and Warrants. As of the date of
this Prospectus, there are outstanding options to purchase an aggregate of
1,448,399 shares of Common Stock at per share exercise prices ranging from $.16
to $6.00. The Company also has outstanding 5,074,283 Warrants (including the
Warrants offered by this Prospectus). Furthermore, outstanding shares of the
Company's Class A Preferred Stock may be converted into an aggregate of at least
2,000,000 shares of Common Stock at any time, outstanding shares of the
Company's Class B Preferred Stock may be converted into 200,000 shares of Common
Stock at any time after October 10, 1997, and outstanding shares of the
Company's Class C Preferred Stock may be converted into 2,575,000 shares of
Common Stock at any time. In addition, the Company may issue additional shares
of Common Stock in respect of dividends paid on outstanding shares of its Class
A Preferred Stock and Class C Preferred Stock. The exercise of such outstanding
options, Warrants and conversion rights will dilute the percentage ownership of
the Company's stockholders, and any sales in the public market of shares of
Common Stock underlying such options, Warrants and conversion rights may
adversely affect prevailing market prices for the Common Stock. Moreover, the
terms upon which the Company will be able to obtain additional equity capital
may be adversely affected since the holders of such outstanding securities can
be expected to exercise their respective rights therein at a time when the
Company would, in all likelihood, be able to obtain any needed capital on terms
more favorable to the Company than those provided in such options, warrants and
conversion rights.
Potential Adverse Effect of Warrant Redemption. The Warrants may be
called for redemption by the Company at any time when the Registration Statement
is current and effective at a redemption price of $.01 per Warrant upon not less
than 30 days' prior written notice if the last sale price of the Common Stock
has been at least $10.00 per share (subject to adjustment in certain
circumstances) on each of the 20 consecutive trading days ending on the third
day prior to the date on which notice is given. Notice of redemption of the
warrants could force the holders to exercise the Warrants and pay the exercise
price at a time when it may be disadvantageous for them to do so, to sell the
Warrants at the current market price when they may otherwise wish to hold the
Warrants, or to accept the redemption price, which may be substantially less
than the market value of the Warrants at the time of redemption.
Possible Volatility of Securities Prices. The market price of Common
Stock and Warrants has in the past been, and may in the future continue to be,
volatile. A variety of events, including quarter to quarter variations in
operating results or news announcements by the Company or its competitors, as
well as market conditions in the freight forwarding industry or changes in
earnings estimates by securities analysts may cause the market price of the
Common Stock to fluctuate significantly. In addition, the stock market in recent
months has experienced significant price and volume fluctuations which have
particularly affected the market prices of equity securities of many companies
and which often have been unrelated to the operating performance of such
companies. These market fluctuations may adversely affect the price of the
Common Stock and Warrants.
9
<PAGE>
Sales by Selling Securityholders. All of the Securities offered hereby
are offered solely by the Selling Securityholders who are not restricted as to
the prices at which they may sell the Securities. Sales of shares of Common
Stock or Warrants below the then current trading prices may adversely affect the
market price of the Common Stock and Warrants.
Potential Limited Trading Market and Nasdaq SmallCap Market Delisting.
The Common Stock and Warrants trade on the Nasdaq SmallCap Market although there
can be no assurance that an active trading market in the Company's securities
will be maintained. On November 6, 1996, the Board of Directors of the Nasdaq
Stock Market, Inc. approved revisions to the maintenance criteria for listing on
the SmallCap Market which are anticipated to be effective later in 1997. One of
such revised maintenance criteria is the requirement that a listed company
maintain a tangible net worth of at least $2 million. As of March 31, 1997, the
Company's net worth, including goodwill, was approximately $2 million, and its
tangible net worth was approximately negative $10.1 million. TIA and CFS have
agreed to convert all or part of the indebtedness owed by the Company to them
into shares of Class D Preferred Stock if such action is necessary to meet such
revised maintenance criteria and if such conversion, together with other plans,
allows the Company to meet such criteria. The Class D Preferred Stock will have
terms similar to the Company's Class A Preferred Stock but will be pari passu
with the Preferred Stock with respect to dividend and liquidation preferences.
As of May 31, 1997, after giving effect to the conversion of the aforementioned
debt, the Company would still require additional financing to meet the Nasdaq
maintenance criteria. Accordingly, the Company currently would not be able to
force conversion of debt held by TIA and CFS into Class D Preferred Stock. The
failure to meet the Nasdaq SmallCap Market revised maintenance criteria after
they become effective may result in the Common Stock or the Warrants not being
eligible for quotations on the Nasdaq SmallCap Market. If this should occur,
trading, if any, in the Common Stock and Warrants, would then continue to be
conducted in the over-the-counter market on the OTC Bulletin Board, as
NASD-sponsored inter-dealer quotation system, or in what are commonly referred
to as "pink sheets." As a result, an investor may find it more difficult to
dispose of or to obtain accurate quotations as to the market value of the Common
Stock and Warrants.
Penny Stock Regulations; Illiquid Securities. The regulations of the
Securities and Exchange Commission promulgated under the Exchange Act require
additional disclosure relating to the market for penny stocks in connection with
trades in any stock defined as a penny stock. Such regulations generally define
a penny stock to be an equity security that has a market price of less than
$5.00 per share, subject to certain exceptions. One exception is quotation on
Nasdaq. Accordingly, if the Company is not quoted on Nasdaq and the market price
of a share of Common Stock is less than $5.00 per share, then the Company would
be subject to the penny stock regulations (unless it satisfied other exceptions,
which it currently does not), including those regulations that require the
delivery, prior to any transaction involving a penny stock, of a disclosure
schedule explaining the penny stock market and the risks associated therewith
and which impose various sales practice requirements on broker-dealers who sell
penny stocks to persons other than established customers and accredited
investors (generally, institutional investors). In addition, under penny stock
regulations, the broker-dealer must provide the customer with current bid and
offer quotations for the penny stock, the compensation of the broker-dealer and
its salesperson in the transaction and monthly account statements showing the
market value of each penny stock held in the customer's account. Moreover,
broker-dealers who recommend "penny stocks" to persons other than established
customers and accredited investors must make a special written suitability
determination for the purchaser and receive the purchaser's written agreement to
a transaction prior to sale. If the Company's securities become subject to the
regulations applicable to penny stocks, the market liquidity for the Company's
securities could be severely affected. In such an event, these regulations could
limit
10
<PAGE>
the ability of broker-dealers to sell the Company's securities and thus the
ability of purchasers of the Company's securities to sell their securities in
the secondary market.
Limited Liability of Directors. The Company's Articles of Incorporation
limit the liability of directors to the maximum extent permitted by Delaware
law.
Issuance of Preferred Stock. Pursuant to its Certificate of
Incorporation, the Company has authority to issue 2,500,000 shares of Preferred
Stock which may be issued by the Board of Directors with such preferences,
limitations and relative rights as the Board may determine without any vote of
the stockholders. As of the date of this Prospectus, 477,500 shares of preferred
stock, in three classes, are outstanding. Issuance of additional shares of
preferred stock, depending upon the preferences, limitations and relative rights
thereof, may have the effect of delaying, deterring or preventing a change in
control of the Company. See "Description of Securities -- Preferred Stock".
RECENT DEVELOPMENTS
Acquisition of Target Air Freight, Inc.
On May 8, 1997, the Company acquired (by merger into the Company's
Target subsidiary) Target Air Freight, Inc. (a California corporation), a Los
Angeles-based freight forwarder ("Air Freight"). Under the terms of the merger
(the "Target Merger"), the Company issued 900,000 shares of Common Stock and
paid $400,000 to Air Freight's stockholders. Following the Target Merger,
Christopher A. Coppersmith, the principal shareholder of Air Freight, became a
director of the Company.
Private Placement
On June 13, 1997, the Company completed a $2,575,000 private placement
of equity securities to individual investors (the "Private Placement"). Under
the terms of the Private Placement, each $100,000 investment purchased 10,000
shares of the Company's Class C Preferred Stock and 50,000 Warrants. See
"Description of Securities".
Shares of Class C Preferred Stock and Warrants acquired in the Private
Placement and all shares of Common Stock underlying such securities or issued as
dividends on the Class C Preferred Stock may not be sold until June 13, 1998
without the approval of GKN Securities Corp. ("GKN"), the placement agent for
the Private Placement.
The Company received $2,276,747 in net proceeds from the Private
Placement. Of these proceeds, $400,000 was used to acquire Air Freight (which
currently operates as the Company's Target subsidiary), $200,000 was used to
repay a short-term loan, and the balance was used for working capital and
general corporate purposes.
Amertranz Subsidiary Losses
While the businesses of the Company's and Consolidated Air subsidiaries
have generated positive cash flows for several years, the business of the
Company's Amertranz subsidiary has incurred operating losses for each of its
operating periods. Because of continuing losses in the Amertranz subsidiary, the
Company
11
<PAGE>
has commenced actions to close the operations of the Amertranz subsidiary and
transfer its customer accounts to the Company's other subsidiaries for fair
consideration.
The Company is currently negotiating with the trade creditors of the
Amertranz subsidiary to allow Amertranz to satisfy its trade payable obligations
on a payment schedule based on existing resources and cash generated from
operations. There can be no assurance that the Company will be successful in
these negotiations. In connection with the closing of the Amertranz subsidiary,
Amertranz will also incur obligations to terminated employees in an amount
currently estimated to be $350,000. While the Company projects that if it is
successful in these negotiations with the Amertranz trade creditors, the closing
of the Amertranz subsidiary will have a positive affect on the Company's
operations, there can be no assurance that the Company will be successful in
these negotiations, that the business of the Amertranz subsidiary will be
preserved and transferred to the Company's other operating subsidiaries, or that
the closing of Amertranz will produce positive operating results. If the Company
is not successful in these negotiations with these trade creditors, or if the
desired results are not achieved for the Amertranz subsidiary, the continued
losses in Amertranz could have a material adverse effect on the Company's
operating results, and the Company may consider other options, including seeking
protection for the Amertranz subsidiary under the Bankruptcy Code.
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of the
Securities by the Selling Securityholders; however, the Company will receive the
exercise price of the Warrants that are exercised. There is no assurance that
any Warrants will be exercised resulting in any proceeds to the Company.
DESCRIPTION OF SECURITIES
General
The authorized capital stock of the Company is 17,500,000 shares,
consisting of 15,000,000 shares of Common Stock, and 2,500,000 shares of
preferred stock. As of the date of this Prospectus, 6,826,504 shares of Common
Stock are outstanding and 477,500 shares of preferred stock are outstanding.
Additionally, as of the date hereof, there are 5,074,283 Warrants outstanding
Common Stock
The shares of Common Stock are currently quoted on the Nasdaq SmallCap
Market under the symbol "AMTZ". The holders of Common Stock are entitled to one
vote for each share held of record on all matters to be voted on by
shareholders. There is no cumulative voting with respect to the election of
directors, with the result that the holders of more than 50% of the shares voted
can elect all of the directors then being elected. The holders of Common Stock
are entitled to receive dividends when, as and if declared by the Board of
Directors out of funds legally available. In the event of liquidation,
dissolution or winding up of the Company, the holders of Common Stock are
entitled to share ratably in all assets remaining available for distribution to
them after payment of liabilities and after provision has been made for each
class of stock, if any, having preference over the Common Stock. Holders of
shares of Common Stock, as such, have no redemption, preemptive or other
subscription rights, and there are no conversion provisions applicable to the
Common Stock. All of the outstanding shares of Common
12
<PAGE>
Stock are fully paid and nonassessable. This Prospectus covers the resale of
1,127,836 shares of Common Stock issued prior to the Company's June 1996 initial
public offering.
The transfer agent and registrar for the Common Stock is American Stock
Transfer & Trust Company, New York, New York 10005, and its telephone number is
(212) 936-5100.
Warrants
The Warrants are currently quoted on the Nasdaq SmallCap Market under
the symbol "AMTZW". Each Warrant entitles the registered holder to purchase one
share of the Common Stock at an exercise price equal to $6.00 during the
four-year period commencing June 28, 1997. No fractional shares of Common stock
will be issued in connection with the exercise of the Warrants and the holder of
any Warrant shall instead receive the number of shares of Common Stock rounded
off to the nearest whole number.
Unless extended by the Company at its discretion, the Warrants will
expire at 5:00 p.m., New York time, on June 28, 2001. In the event that a holder
of Warrants fails to exercise the Warrants prior to their expiration, the
Warrants will expire and the holder thereof will have no further rights with
respect to the Warrants.
Provided that not less than 30 days' notice of redemption is given and
the last sale price of the Common Stock has been at least $10.00 for each of the
20 trading days ending on the third business day prior to the day on which
notice is given, the Company has the right to call the Warrants for redemption
at a redemption price of $.01 per Warrant.
No Warrants will be exercisable unless at the time of exercise there is
a current prospectus covering the shares of Common Stock issuable upon exercise
of such Warrants under an effective registration statement filed with the
Commission and such shares have been qualified for sale or are exempt from
qualification under the securities laws of the state of residence of the holder
of such Warrants. Although the Company intends to have all shares so qualified
for sale in those states where the Securities are being offered and to maintain
a current prospectus relating thereto until the expiration of the Warrants,
subject to the terms of the Warrant Agreement between the Company and American
Stock Transfer & Trust Company (the Warrant Agent with respect to the Warrants),
there can be no assurance that it will do so.
A holder of the Warrants will not have any rights, privileges or
liabilities as a stockholder of the Company prior to exercise of the Warrants.
The Company is required to keep reserved a sufficient number of authorized
shares of Common Stock to permit the exercise of the Warrants.
The exercise price of the Warrants will be subject to adjustment to
protect against dilution in the event of stock dividends, stock splits,
combinations, subdivisions and reclassifications. No assurance can be given that
the market price of the Common Stock will exceed the exercise price of the
Warrants at any time during the exercise period.
This Prospectus covers the issuance of shares of Common Stock upon
exercise of the 2,300,000 Warrants issued by the Company in its June 1996
initial public offering, the resale of 1,386,783 Warrants by the Selling
Securityholders, and the issuance of shares of Common Stock upon exercise of
such Warrants.
13
<PAGE>
Preferred Stock
The Company's Board of Directors has the authority, without further
action by the stockholders, to issue 2,500,000 shares of preferred stock, in one
or more series and to fix the rights, preferences, privileges and restrictions
thereof, including dividend rights, conversion rights, voting rights, terms of
redemption, liquidation preferences, and the number of shares constituting any
series or the designation of such series. To date, the Company has designated;
(i) 500,000 shares of preferred stock as Class A Preferred Stock and has issued
200,000 shares of Class A Preferred Stock; (ii) 25,000 shares of preferred stock
as Class B Preferred Stock and has issued 20,000 shares of Class B Preferred
Stock; and (iii) 400,000 shares of preferred stock as Class C Preferred Stock
and has issued 257,500 shares of Class C Preferred Stock. The issuance of
preferred stock in the future could adversely affect the voting power of holders
of the Common Stock and could have the effect of delaying, deferring or
preventing a change in control of the Company. Other than creating a new class
of preferred stock to be designated Class D Preferred Stock for the purpose of
converting certain outstanding indebtedness of the Company, as described below,
the Company has no present plan to issue any additional shares of preferred
stock.
Class A Preferred Stock. The shares of Class A Preferred Stock have a
par or stated value of $10.00 per share. Dividends on Class A Preferred Stock
accrue at an annual rate of $1.00 per share, and are payable semi-annually in
arrears on June 30 and December 31 of each year, in cash or, at the option of
the Company, in shares of Class A Preferred Stock at the rate of $10.00 per
share. The Class A Preferred Stock has priority as to dividends over the Common
Stock and all other series or classes of the Company's stock that rank junior to
the Class A Preferred Stock. On liquidation, holders of shares of Class A
Preferred Stock will be entitled to receive a preferred distribution equal to
$10.00 per share, plus an amount equal to any accrued and unpaid dividends
before any payment or distribution is made to the holders of Common Stock or any
other series or class of stock that ranks junior as to liquidation rights to the
Class A Preferred Stock. The holders of Class A Preferred Stock have no voting
rights except as required by law. Each share of Class A Preferred Stock is
convertible into Common Stock at any time at a conversion price (subject to
adjustment) of the lower of (i) $6.00 per share, or (ii) 80% of the average of
the closing bid and asked price per share of Common Stock on the day prior to
the conversion date. In connection with the Private Placement, the Company has
agreed that each share of Class A Preferred Stock may be converted, until August
12, 1997, into 10 shares of Common Stock.
Class B Preferred Stock. The shares of Class B Preferred Stock have a
par or stated value of $10.00 per share. No dividends are paid on shares of
Class B Preferred Stock, and the shares do not carry a liquidation preference or
any voting rights (except as required by law). Each share of Class B Preferred
Stock is convertible into 10 shares of Common Stock (subject to adjustment) from
and after October 10, 1997.
Class C Preferred Stock. Each share of Class C Preferred Stock has a
Stated Value of $10.00 and earns cumulative dividends at 10% per annum (pro
rated for shorter periods) payable quarterly, in arrears, in cash or, at the
Company's option if the Registration Statement is effective and current, in
shares of Common Stock (based on the average closing bid price per share of
Common Stock on the five trading days ending two business days prior to the
respective dividend payment date). Upon a liquidation of the Company (including,
at the option of the holder, a merger or consolidation in which the Company is
not the surviving entity or a sale by the Company of all or substantially all of
its assets), the holders of the Class C Preferred Stock are entitled to receive,
prior to the distribution to the holders of the Company's Common Stock, Class A
Preferred Stock and Class B Preferred Stock, an amount per share equal to the
greater of (i) the Stated Value plus any accrued and unpaid dividends, or (ii)
the amount they would have
14
<PAGE>
received had they converted the Class C Preferred Stock into Common Stock on the
business day immediately prior to the record date with respect to such
liquidation. The holders of the Class C Preferred Stock have the right, at any
time, to convert each share of Class C Preferred Stock into 10 shares of Common
Stock. Subject to the conversion right, the Company may redeem the Class C
Preferred Stock at its Stated Value plus all accrued and unpaid dividends if the
Registration Statement is effective and current, upon 30 days' written notice
given at any time if the last sale price of the Common Stock has been at least
$2.50 on all 20 of the trading days ending on the third date prior to the date
on which written notice of redemption is given. The Class C Preferred Stock
ranks senior to all classes of the Company's capital stock now existing or which
may be created in the future; provided, however, that the Company is entitled to
create a Class D Preferred Stock, which would rank pari passu with the Class C
Preferred Stock with respect to dividend and liquidation preferences, for
issuance solely to certain holders of Company debt upon the occurrence of
certain events. The holders of the Class C Preferred Stock do not have voting
rights until such time as they convert their Class C Preferred Stock into Common
Stock, except as provided by law.
Class D Preferred Stock. The Class D Preferred Stock, if created by the
Company, will have the same terms as the Class A Preferred Stock, except that it
will rank pari passu with the Class C Preferred Stock with respect to dividend
and liquidation preferences. The Class D Preferred Stock will be created by the
Company only in certain circumstances under which certain debt held by
stockholders of the Company is converted into Class D Preferred Stock. See "Risk
Factors -- Potential Limited Trading Market."
SELLING SECURITYHOLDERS
In addition to the 2,300,000 shares of Common Stock issuable upon
exercise of the Warrants issued by the Company in its June 1996 initial public
offering, the Securities offered hereby consist of (i) 1,127,836 shares of
Common Stock and 1,386,783 Warrants issued in various private financings prior
to the Company's June 1996 initial public offering, and (ii) 200,000 shares of
Common Stock and 200,000 Warrants which may be issued upon exercise of the
Underwriter's Purchase Option granted to GKN in connection with the Company's
June 1996 initial public offering. All Warrants and the Underwriter's Purchase
Option and underlying Warrants are immediately exercisable for shares of Common
Stock.
The following table sets forth information as of June 30, 1997
regarding the beneficial ownership of shares of Common Stock held by each
Selling Securityholder (including shares of Common Stock which such Selling
Securityholder has the right to acquire within 60 days following the date of
this Prospectus), and Warrants held by each Selling Securityholder. Except as
indicated, (i) all of such shares and Warrants are being registered for sale
under the Registration Statement of which this Prospectus forms a part, (ii)
none of such shares and Warrants will be owned by such Selling Securityholder
following the sale of the Securities offered pursuant to this Prospectus, and
(iii) the percentage ownership of each Selling Securityholder will be less than
one percent of the respective class of Securities following the sale of the
Securities offered pursuant to this Prospectus.
<TABLE>
<CAPTION>
Number of Number of
Selling Securityholders Shares(1) Warrants
<S> <C> <C>
Leon Abramson 11,250 7,500
John Aletti(2) 48,750 20,000
ALSA, Inc. 22,500 15,000
David Stephen Becker 11,250 7,500
15
<PAGE>
Number of Number of
Selling Securityholders Shares(1) Warrants
Neil Bellett 11,250 7,500
Robert Bender 11,250 7,500
Stanley H. Blum(3) 97,500 40,000
Eliot H. Brown 11,250 7,500
Glenn Cadrez 11,250 7,500
William C. Clement 11,250 7,500
Kenneth D. Cole 22,500 15,000
Henri Cristini 11,250 7,500
William J. Curtis 22,500 15,000
Dalewood Associates, L.P.(4) 195,000 130,000
Robert Dorskind 11,250 7,500
Craig Effron 22,500 15,000
Drew Effron 11,250 7,500
Kenneth M. Endelson 11,250 7,500
Richard Etra(5) 86,250 32,500
Steven Etra(6) 67,500 26,250
Melvin Finkelstein 11,250 7,500
Gordon M. Freeman 22,500 15,000
Jack Gold 11,250 7,500
Lloyd Goldman 11,250 7,500
Ernest Gottdiener(5) 11,250 7,500
Leigh Gove 11,250 7,500
Paula Graff 11,250 7,500
Anthony S. Graffeo and Angelina Graffeo 11,250 7,500
Bruce Greenberg 45,000 30,000
Glenda Guttentag 11,250 7,500
Gary C. & Kathleen R. Hall JTWROS 11,250 7,500
Robert L. Jacobs 11,250 7,500
Frank and Charlotte Joy JTWROS 11,250 7,500
Stuart Kahn & Company 11,250 7,500
Daniel A. Kaplan 11,250 7,500
Delaware Charter Custodian for C. Daniel Karnes--IRA Account 11,250 7,500
Rebecca Jane Karpoff and Stefan Shoup JTWROS 11,250 7,500
Richard C. Kaufman and Elaine J. Lenart JTWROS(5) 11,250 7,500
Donald M. Kleban 22,500 15,000
Michael Kremins 11,250 7,500
Norman Kurtz 11,250 7,500
David Kushner 11,250 7,500
Steven and Rona Landman JTWROS 5,625 11,250
Boris and Marina Laskin JTWROS 11,250 7,500
Alex Lauchlin 11,250 7,500
Donald R. Levin 11,250 7,500
William Levin 11,250 7,500
Paul D. Levitt & Leslie Levitt Revocable Trust 11,250 7,500
Stephen Lewen 11,250 7,500
Irwin Lieber 11,250 7,500
Mariwood Investments 11,250 7,500
Joseph and Georgia Melnick JTWROS 45,000 30,000
Eli Oxenhorn 11,250 7,500
Robert J. Parkes & Carol J. Parkes JTWROS 11,250 7,500
RJB Partners(5) 11,250 7,500
Patricia Reyes 11,250 7,500
Jonathan Robinson 22,500 15,000
Andrew Rosen 11,250 7,500
Martin Rosenman 11,250 7,500
William J. Rouhana, Jr. 11,250 7,500
The Marilyn and Barry Rubenstein Family Foundation(7) 22,500 15,000
Alan J. Rubin 11,250 7,500
Jeff Rubin 11,250 7,500
16
<PAGE>
Number of Number of
Selling Securityholders Shares(1) Warrants
S.V. Construction Company 11,250 7,500
Scott G. Sandler 11,250 7,500
John Sarracco 11,250 7,500
Curtis Schenker 11,250 7,500
Sharon Schneider 11,250 7,500
Carl E. Siegel 11,250 7,500
Dean Spellman 5,625 11,250
Charles Stentiford 11,250 7,500
Mitchell Stern 11,250 7,500
Craig Swift 11,250 7,500
David Thalheim(7) 22,500 15,000
Frank K. Turner 11,250 7,500
United Growth Fund Profit Sharing, Inc. 11,250 7,500
Marie E. Valdes 11,250 7,500
Richard Warren 11,250 7,500
Charles Warshaw 11,250 7,500
Weiskopf Silver & Co. 11,250 7,500
Michael Weissman 22,500 15,000
Lance Wolfson 11,250 7,500
William Wolfson(8) 45,000 30,000
Woodland Partners(7)(9) 545,000 280,000
Leonard Zelin 22,500 15,000
MH Capital Partners 12,500 --
155964 Canada, Inc. 10,555 13,335
Clinton Company 8,796 11,112
Swan Alley Nominees 39,459 49,836
Philip S. Rosso, Jr.(10) 198,667 --
Martin Hoffenberg(11) 165,541 --
David R. Pulk(12) 111,111 --
Michael Barsa(13) 361,010 80,000
Bruce Brandi(14) 35,761 --
Edward R. Reedy(15) 23,480 --
Anil K. Bhandari 14,363 --
Michael Kilzi 12,971 --
Allan Rubin Trust 57,771 --
Barrett M. Fisher 7,098 --
Jean Barsa(16) 145,965 55,000
Truck Net, Inc. 14,570 --
TIA, Inc.(17) 3,740,000 200,000
GKN Securities Corp.(18) 356,415 142,805
David N. Nussbaum(19) 117,945 49,315
Roger N. Gladstone(19) 117,945 49,315
Robert H. Gladstone(19) 117,945 49,315
- --------------------------------
<FN>
(1) These numbers include all shares of Common Stock owned by the Selling
Securityholder and all shares of Common Stock which such Selling
Securityholder has the right to acquire within 60 days following the date
of this Prospectus, including pursuant to the exercise of Warrants. These
numbers do not include any shares of Common Stock which may be issued (i)
upon conversion of shares of the Company's Class A Preferred Stock to be
accrued and issued as dividends on the outstanding shares of Class A
Preferred Stock, or (ii) as dividends on the outstanding shares of Class C
Preferred Stock.
(2) Only 3,750 shares of Common Stock and 7,500 Warrants and shares of Common
Stock underlying such Warrants are being registered for sale under the
Registration Statement of which this Prospectus forms a part. 37,500 shares
of Common Stock and 12,500 Warrants will be owned following the sale of the
Securities offered pursuant to this Prospectus.
(3) Only 7,500 shares of Common Stock and 15,000 Warrants and shares of Common
Stock underlying such Warrants are being registered for sale under the
Registration Statement of which this Prospectus forms a part. 75,000 shares
of Common Stock, representing 1.1% of
17
<PAGE>
the outstanding shares of Common Stock, and 25,000 Warrants will be owned
following the sale of the Securities offered pursuant to this Prospectus.
(4) Does not include (i) 22,500 shares and 15,000 Warrants owned by David
Thalheim, a Selling Securityholder, who is a 50% stockholder and executive
officer of the corporate general partner of Dalewood Associates, L.P., and
(ii) 22,500 shares and 15,000 Warrants owned by The Marilyn and Barry
Rubenstein Family Foundation, a Selling Securityholder, one of the trustees
of which, Barry Rubenstein is a 50% stockholder and executive officer of
the corporate general partner of Dalewood Associates, L.P.
(5) Only 3,750 shares of Common Stock and 7,500 Warrants and shares of Common
Stock underlying such Warrants are being registered for sale under the
Registration Statement of which this Prospectus forms a part. 75,000 shares
of Common Stock, representing 1.1% of the outstanding shares of Common
Stock, and 25,000 Warrants will be owned following the sale of the
Securities offered pursuant to this Prospectus.
(6) Only 3,750 shares of Common Stock and 7,500 Warrants and shares of Common
Stock underlying such Warrants are being registered for sale under the
Registration Statement of which this Prospectus forms a part. 56,250 shares
of Common Stock and 18,750 Warrants will be owned following the sale of the
Securities offered pursuant to this Prospectus.
(7) Does not include 195,000 shares and 130,000 Warrants owned by Dalewood
Associates, L.P.
(8) Only 15,000 shares of Common Stock and 30,000 Warrants and shares of Common
Stock underlying such Warrants are being registered for sale under the
Registration Statement of which this Prospectus forms a part. 75,000 shares
of Common Stock, representing 1.1% of the outstanding shares of Common
Stock, and 25,000 Warrants will be owned following the sale of the
Securities offered pursuant to this Prospectus.
(9) Only 65,000 shares of Common Stock and 130,000 Warrants and shares of
Common Stock underlying such Warrants are being registered for sale under
the Registration Statement of which this Prospectus forms a part. Does not
include 22,500 shares and 15,000 Warrants owned by The Marilyn and Barry
Rubenstein Family Foundation, a Selling Stockholder, a trustee of which is
a general partner of Woodland Partners. 350,000 shares of Common Stock and
150,000 Warrants, representing 4.8% of the outstanding shares of Common
Stock and 3% of the outstanding Warrants, will be owned following the sale
of the Securities offered pursuant to this Prospectus.
(10) Represents 2.3% of the outstanding shares of Common Stock following
consummation of the Offering. Only 41,460 of such shares are being
registered for sale under the Registration Statement of which this
Prospectus forms a part. Mr. Rosso serves as Senior Vice President
Operations of Amertranz.
(11) Represents 1.8% of the outstanding shares of Common Stock following
consummation of the Offering. Only 40,000 of such shares are being
registered for sale under the Registration Statement of which this
Prospectus forms a part. Mr. Hoffenberg is the former Chief Executive
Officer of Amertranz.
(12) Includes options to purchase 6,957 shares of Common Stock. Only 104,154
shares of Common Stock are being registered for sale under the Registration
Statement of which this Prospectus forms a part. Mr. Pulk is the former
President, International Division of Amertranz.
(13) Includes options to purchase 154,477 shares of Common Stock. Only 96,451
shares of Common Stock and 50,000 Warrants and shares of Common Stock
underlying such Warrants are being registered for sale under the
Registration Statement of which this Prospectus forms a part. 214,559
shares of Common Stock, representing 3.1% of the outstanding shares of
Common Stock, and 30,000 Warrants will be owned following the sale of the
Securities offered pursuant to this Prospectus. Mr. Barsa is a director of
the Company and is the former Chief Financial Officer of Amertranz and
former Vice President and Secretary of the Company.
(14) Includes options to purchase 28,393 shares of Common Stock. Only 7,368
shares of Common Stock are being registered for sale under the Registration
Statement of which this Prospectus forms a part. 28,393 shares of Common
Stock will be owned following the sale of the Securities offered pursuant
to this Prospectus. Mr. Brandi serves as the President of Amertranz.
(15) Includes options to purchase 20,375 shares of Common Stock. Only 3,105
shares of Common Stock are being registered for sale under the Registration
Statement of which this Prospectus forms a part. 20,375 shares of Common
Stock will be owned following the sale of the Securities offered pursuant
to this Prospectus. Mr. Reedy is the former Senior Vice President,
International Division of Amertranz.
(16) Only 40,965 shares of Common Stock and 30,000 Warrants and shares of Common
Stock underlying such Warrants are being registered for sale under the
Registration Statement of which this Prospectus forms a part. 75,000 shares
of Common Stock, representing 1.1% of the outstanding shares of Common
Stock, and 25,000 Warrants will be owned following the sale of the
Securities offered pursuant to this Prospectus.
(17) Only 100,000 shares of Common Stock, the Warrants and shares of Common
Stock underlying such Warrants are being registered for sale under the
Registration Statement of which this Prospectus forms a part. 3,640,000
shares of Common Stock, representing 42.4% of the outstanding shares of
Common Stock, will be owned following the sale of the Securities offered
pursuant to this Prospectus. Does not include 860,000 shares owned by CFS
and 580,370 shares with respect to which TIA and CFS have been granted
proxies. 51% of the issued and outstanding stock of CFS, and voting control
of all of the issued and outstanding stock of CFS, is held by TIA. Stuart
Hettleman, a director and President of the Company owns a non-controlling
indirect minority interest in TIA and is an executive officer of TIA and
CFS. Richard A. Faieta, a director and Executive Vice President of the
Company is a non-controlling minority stockholder of TIA and is an
executive officer of TIA and CFS. Messrs. Hettleman and Faieta disclaim
beneficial ownership of all shares of Common Stock and Warrants owned by
TIA and CFS.
(18) Only 72,000 shares of Common Stock and 72,000 Warrants and shares of Common
Stock underlying such Warrants are being registered for sale under the
Registration Statement of which this Prospectus forms a part. 212,415
shares of Common Stock and 70,805 Warrants, representing 3% of the
outstanding shares of Common Stock and 1.4% of the outstanding Warrants,
will be owned following the sale of the Securities offered pursuant to this
Prospectus.
(19) Only 30,000 shares of Common Stock and 30,000 Warrants and shares of Common
Stock underlying such Warrants are being registered for sale under the
Registration Statement of which this Prospectus forms a part. 57,945 shares
of Common Stock and 19,315 Warrants will be owned following the sale of the
Securities offered pursuant to this Prospectus.
</FN>
</TABLE>
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PLAN OF DISTRIBUTION
The shares of Common Stock and the Warrants registered for sale under
the Registration Statement of which this Prospectus forms a part may be offered
and sold from time to time in transactions (which may include block
transactions) on the Nasdaq SmallCap Market, in negotiated transactions, or a
combination of such methods of sale, at fixed prices which may be changed, at
market prices prevailing at the time of sale, or at negotiated prices. None of
the other Selling Securityholders have advised the Company that they have
entered into any agreements, understandings or arrangements with any
underwriters or broker-dealers regarding the sale of their Securities. The
Selling Securityholders may effect such transactions by selling their shares
directly to purchasers or to or through broker-dealers (including GKN), which
may act as agents or principals. Such broker-dealers may receive compensation in
the form of discounts, concessions, or commissions from the Selling
Securityholders and/or the purchasers of the Shares for whom such broker-dealers
may act as agents or to whom they sell as principal, or both (which compensation
as to a particular broker-dealer might be in excess of customary commissions).
GKN is one of several market makers in the Company's Common Stock and Warrants.
The Selling Securityholders and any broker-dealers that act in connection with
the sale of the shares might be deemed to be "underwriters" within the meaning
of Section 2(11) of the Securities Act. The Selling Securityholders may agree to
indemnify any agent, dealer or broker-dealer that participates in transactions
involving sales of the securities against certain liabilities, including
liabilities arising under the Securities Act.
In order to comply with the applicable securities laws of certain
states, if any, the shares of Common Stock and Warrants will be offered or sold
through registered or licensed brokers or dealers in those states. In addition,
in certain states the Securities may not be offered or sold unless they have
been registered or qualified for sale in such states or an exemption from such
registration or qualification requirement is available and such offering or sale
is in compliance therewith.
The Selling Securityholders also may sell some or all of the Securities
directly to purchasers without the assistance of any broker/dealer or, if a
Selling Securityholder is an entity, distribute such Securities to one or more
of its equity owners and such equity owners may, in turn, distribute such
Securities as described above.
The Company is bearing all costs relating to the registration of the
Securities, provided that any commissions or other fees payable to
broker/dealers in connection with any sale of the Securities will be borne by
the Selling Securityholders or other party selling such Securities.
Pursuant to applicable rules and regulations under the Exchange Act,
any person engaged in a distribution of the Securities may not simultaneously
engage in market making activities with respect to the Securities for a period
beginning when such person becomes a distribution participant and ending upon
such person's completion of participation in such distribution, including
stabilization activities in the Securities to effect syndicate covering
transactions, to impose penalty bids or to effect passive market making bids. In
addition, and without limiting the foregoing, in connection with activities in
the Securities, the Selling Securityholders will be subject to applicable
provisions of the Exchange Act and the rules and regulations thereunder,
including, without limitation, Regulation M and Rules 100, 101, 102, 103, 104
and 105 thereof. All of the foregoing may affect the marketability of the
Securities.
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INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's By-laws provide that the Company shall, to the fullest
extent permitted by Section 145 of the General Corporation Law of the State of
Delaware, as amended from time to time, indemnify all person whom it may
indemnify pursuant thereto.
Section 145 of the General Corporation Law of the State of Delaware
permits a corporation, under specified circumstances, to indemnify its
directors, officers, employees or agents against expenses (including attorney's
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by them in connection with any action, suit or proceeding brought by
third parties by reason of the fact that they were or are directors, officers,
employees or agents of the corporation, if such directors, officers, employees
or agents acted in good faith and in a manner they reasonably believed to be in
or not opposed to the best interests of the corporation and, with respect to any
criminal action or proceeding, had no reason to believe their conduct was
unlawful. In a derivative action, i.e., one by or in the right of the
corporation, indemnification may be made only for expenses actually and
reasonably incurred by directors, officers, employees or agents in connection
with the defense or settlement of an action or suit, and only with respect to a
matter as to which they shall have acted in good faith and in a manner they
reasonably believed to be in or not opposed to the best interests of the
corporation, except that no indemnification shall be made if such person shall
have been adjudged liable to the corporation, unless and only to the extent that
the court in which the action or suit was brought shall determine upon
application that the defendant directors, officers, employees or agents are
fairly and reasonably entitled to indemnity for such expenses despite such
adjudication of liability.
Article Seventh of the Company's Certificate of Incorporation provides
that the Company's directors will not be personally liable to the Company or its
stockholders for monetary damages resulting from breaches of their fiduciary
duty as directors except (a) for any breach of the duty of loyalty to the
Company or its stockholders, (b) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (c) under
Section 174 of the General Corporation Law of the State of Delaware, which makes
directors liable for unlawful dividends or unlawful stock repurchases or
redemptions, or (d) for transactions from which directors derive improper
personal benefit.
The Company also maintains director and officer insurance coverage.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Company pursuant to the foregoing provisions, or otherwise, the Company has been
advised that in the opinion of the Commission such indemnification is against
public policy as expressed in the Securities Act and is therefore unenforceable.
EXPERTS
The consolidated financial statements of Amertranz Worldwide Holding
Corp. as of June 30, 1996 incorporated by reference in this Prospectus have been
audited by Arthur Andersen LLP, independent public accountants, as indicated in
their reports with respect thereto, and are included herein in reliance upon the
authority of said firm as experts in giving said reports.
The financial statements of Amertranz Worldwide Holding Corp. (formerly
The Freight Forwarding Business of TIA and CFS) as of December 31, 1994 and 1995
and for each of the years in the three-year
20
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period ended December 31, 1995, have been incorporated by reference herein in
reliance upon the report of KPMG Peat Marwick LLP, independent certified public
accountants, incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing.
C69668Z.198
21
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