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Filed Pursuant to Rule 424B3
Registration Statement
No. 333-56791
575,132 SHARES
STAFFMARK, INC. COMMON STOCK
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This Prospectus covers 575,132 shares (the "Shares") of common stock,
$.01 par value (the "Common Stock"), which may be offered by certain
stockholders (the "Selling Stockholders") of StaffMark, Inc., a Delaware
corporation (the "Company"), from time to time directly or through one or more
broker-dealers, in one or more transactions on the Nasdaq National Market (the
"Nasdaq National Market"), or in negotiated transactions, in each case at prices
satisfactory to the Selling Stockholders. See "Plan of Distribution." All of the
Shares to be sold by any of the Selling Stockholders were issued pursuant to the
acquisition by the Company of a business which was previously owned by the
Selling Stockholders. The Company will not receive any of the proceeds from the
sale of any of the Shares by the Selling Stockholders. All expenses of
registration of the shares which may be offered hereby under the Securities Act
of 1933, as amended (the "Securities Act"), will be paid by the Company (other
than underwriting discounts and selling commissions, and fees and expense of
advisers to the Selling Stockholders).
As of July 1, 1998 the Company had 20,764,309 shares of its Common
Stock outstanding. The Common Stock is traded on the Nasdaq National Market
under the symbol "STAF." On July 1, 1998, the last reported sale price of the
Common Stock on the Nasdaq National Market was $36.375 per share.
See "RISK FACTORS" beginning on page 3 of this Prospectus for a
discussion of certain factors that should be considered by prospective
purchasers of the Common Stock offered hereby.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
July 2, 1998
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AVAILABLE INFORMATION
The Company is subject to the information 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 may be inspected and copied at the public
reference facilities maintained by the Commission at Judiciary Plaza Building,
450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at its regional
offices located at 7 World Trade Center, 13th Floor, New York, New York 10048,
and CitiCorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661-2511. Copies of such materials may be obtained from the Commission at
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed
rates. The Commission maintains an Internet Web site that contains reports,
proxy and information statements and other information regarding issuers that
file electronically with the Commission. The address of that site is
http://www.sec.gov.
The Company has filed with the Commission a Registration Statement on
Form S-3 under the Securities Act with respect to the Common Stock offered
hereby. This Prospectus does not contain all the information set forth in the
Registration Statement and the exhibits and schedules thereto. For further
information with respect to the Company and such Common Stock, reference is made
to such Registration Statement and exhibits. A copy of the Registration
Statement on file with the commission may be obtained from the Commission's
principal office in Washington, D.C. upon payment of the fees prescribed by the
Commission or through the Commission's Internet Web site.
The Company's Common Stock is traded on the Nasdaq National Market.
Proxy statements and other information concerning the Company can also be
inspected at the offices of the Nasdaq National Market, 1735 K Street,
Washington, D.C. 20006.
INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed with the Commission pursuant to the
Exchange Act are incorporated herein by reference:
(i) The Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1997 (File No. 0-20971) filed with the
Commission on March 13, 1998;
(ii) The Company's Form 8-K/A filed on January 16, 1998 with
respect to the Company's Form 8-K filed on November 21, 1997;
(iii) The Company's Form 8-K filed on January 23, 1998 and the Form
8-K/A related thereto filed on March 16, 1998;
(iv) The Company's Form 8-K filed on February 23, 1998;
(v) The Company's Form 10-Q for the quarterly period ended March
31, 1998 (File No. 0-20971) filed with the Commission on May
7, 1998; and
(vi) The description of the Common Stock, contained in the
Company's registration statement on Form 8-A, (File No.
0-20971), filed on September 17, 1996, pursuant to Section 12
of the Exchange Act.
All reports and other documents filed by the Company with the
Commission pursuant to Section 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 of the shares shall be deemed to be incorporated herein by reference
and to be a part hereof from the date of filing of such documents.
Any statement contained herein in a document incorporated or deemed to
be incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement
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contained herein or in any other subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
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 will furnish without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon the written or oral
request of such person, a copy of any or all of the documents incorporated
herein or in the Registration Statement by reference (other than exhibits to
such documents unless such exhibits are specifically incorporated by reference
in such documents). All requests for such information should be directed to:
StaffMark, Inc., 302 East Millsap Road, Fayetteville, Arkansas 72703, Attention:
Gordon Y. Allison, Executive Vice President - General Counsel; telephone (501)
973-6000.
RISK FACTORS
An investment in the Shares of Common Stock offered by this Prospectus
involves a high degree of risk. In addition to the other information contained
in this Prospectus, the following risk factors should be considered carefully in
evaluating the Company and its business before purchasing shares of the Common
Stock offered hereby.
ABILITY TO ACHIEVE AND MANAGE GROWTH; ACQUISITION RISKS. The Company has
experienced significant growth, principally through acquisitions, internal
growth and opening new offices. There can be no assurance that the Company will
be able to expand its market presence in its current locations or successfully
enter other markets through acquisitions or the opening of new offices. The
Company's ability to continue its growth and profitability will depend on a
number of factors, including the availability of capital to fund acquisitions,
existing and emerging competition, the ability to maintain sufficient profit
margins despite pricing pressures and the strength of demand for temporary
employees in the Company's markets. The Company must also manage costs in a
changing regulatory environment, adapt its infrastructure and systems to
accommodate growth and recruit and train additional qualified personnel.
Additionally, there can be no assurance that the Company will be able to
successfully identify suitable acquisition candidates, complete acquisitions or
integrate acquired businesses into its operations. Once integrated, acquisitions
may not achieve comparable levels of revenue, profitability or productivity as
the Company's existing locations or otherwise perform as expected. Acquisitions
also involve special risks, including risks associated with unanticipated
problems, liabilities and contingencies, diversion of management attention and
possible adverse effects on earnings resulting from increased goodwill
amortization, increased interest costs, the issuance of additional securities
and difficulties related to the integration of the acquired business. The
Company is unable to predict whether or when any prospective acquisition
candidate will become available or the likelihood that any acquisition will be
completed.
EFFECT OF FLUCTUATIONS IN THE GENERAL ECONOMY. Demand for the Company's
staffing services is significantly affected by the general level of economic
activity and unemployment in the United States. When economic activity
increases, temporary employees are often added before full-time employees are
hired. However, as economic activity slows, many companies reduce their
utilization of temporary employees prior to undertaking layoffs of full-time
employees. In addition, the Company may experience more competitive pricing
pressure during periods of economic downturn. Therefore, any significant
economic downturn could have a material adverse effect on the Company's
business, financial condition and results of operations.
FLUCTUATIONS IN OPERATING RESULTS; FLUCTUATIONS IN QUARTERLY RESULTS.
The Company's operating results have fluctuated in the past and will fluctuate
in the future based on many factors. These factors include, among others,
changes in the regulatory environment, failure to adequately integrate acquired
companies, fluctuations in the general economy, increased competition, the
opening of new branch offices, changes in operating expenses, expenses related
to acquisitions, and the potential adverse effect of acquisitions. Due to these
and any unforeseen factors, it is likely that in some future quarter the
Company's operating results will be below the expectations of public market
analysts and investors. In such an event, the price of the Common Stock would
likely be materially
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adversely affected. In view of the Company's recent significant growth, the
Company believes that period-to-period comparisons of its financial results are
not necessarily meaningful and should not be relied upon as an indication of
future performance. Because the Company only derives revenue when its temporary
associates, consultants and professionals are actually working, its operating
results are adversely affected when client facilities close due to holidays or
inclement weather. The Company generally experiences lower revenues, operating
income and net income during the first and fourth quarters due to certain
holidays, weather conditions and seasonal vacation patterns.
DEPENDENCE ON AVAILABILITY OF QUALIFIED TEMPORARY PERSONNEL. The Company
depends on its ability to attract, train and retain personnel who possess the
skills and experience necessary to meet the staffing requirements of its
clients. Competition for individuals with proven skills in certain areas,
particularly in the professional/information technology and specialty niche
fields, is intense. The Company competes in several markets in which
unemployment is relatively low thereby increasing competition for employees. The
Company must continually evaluate, train and upgrade its base of available
personnel to keep pace with clients' needs. There can be no assurance that
qualified personnel will continue to be available to the Company in sufficient
numbers and on terms of employment acceptable to the Company. The inability to
attract and retain qualified personnel could have a material adverse effect on
the Company's business, financial condition and results of operations.
COMPETITIVE MARKET. The temporary staffing industry is highly
competitive, with limited barriers to entry. The Company competes for employees
and clients in national, regional and local markets with full-service and
specialized temporary staffing service businesses. A significant number of
competitors have greater marketing, financial and other resources and more
established operations than the Company. Price competition in the staffing
industry is intense, particularly for the provision of commercial personnel and
pricing pressures from competitors and customers are increasing. The Company
expects that the level of competition will remain high in the future, which
could limit the Company's ability to maintain or increase its market share or
maintain or increase gross margins, either of which could have a material
adverse effect on the Company's business, financial condition and results of
operations.
INCREASED EMPLOYEE COSTS. The Company is required to pay unemployment
insurance premiums and workers' compensation for its temporary employees.
Unemployment insurance premiums may increase as a result of, among other things,
increased levels of unemployment and the lengthening periods for which
unemployment benefits are available. Workers' compensation costs may increase as
a result of changes in the Company's experience ratings or applicable laws.
Although management believes its workers' compensation coverage amounts are
adequate, there can be no assurance that the Company's actual future workers'
compensation claims will not exceed the coverage amounts. The Company's workers'
compensation insurance premiums are subject to retroactive increases based upon
audits of the Company's employee classification practices and other data
provided to the insurance carrier. The Company has retained the services of an
independent third-party administrator and an independent actuary to assist the
Company in establishing appropriate reserves for the uninsured portion of claims
(up to the deductible amount), but such reserves are only estimates of future
payments relating to claims and are based upon limited prior experience.
Although management believes its recorded reserve is adequate, there can be no
assurance that the Company's actual future workers' compensation obligations
will not exceed the amount of its workers' compensation reserve. The Company may
incur costs related to workers' compensation claims at a higher rate due to such
causes as higher than anticipated losses from known claims or an increase in the
number and severity of new claims.
INTANGIBLE ASSETS. As of March 31, 1998, approximately $204 million, or
69%, of the Company's total assets were intangible assets. These intangible
assets primarily represent amounts attributable to goodwill recorded in
connection with the Company's acquisitions. Any impairment in the value of such
assets could have a material adverse effect on the Company's financial condition
and results of operations.
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RISK OF GOVERNMENT REGULATIONS AND LEGISLATIVE PROPOSALS. The Company's
costs could increase if there are any material changes in government
regulations. Recent federal and certain state legislative proposals have
included provisions extending health insurance benefits to employees not
presently receiving such benefits. Due to the wide variety of national and state
proposals currently under consideration, the impact of such proposals cannot be
predicted. There can be no assurance that the Company will be able to increase
the fees charged to its clients in a timely manner and sufficient amount to
cover increased costs related to any new benefits that may be extended to
temporary employees. It is not possible to predict whether other legislation or
regulations affecting the Company's operations will be proposed or enacted at
the federal or state level.
GOVERNMENT REGULATION OF IMMIGRATION. Certain of the Company's
Professional/IT consultants are foreign nationals working in the United States
under H-1B permits. Accordingly, both the Company and these foreign nationals
must comply with United States immigration laws. The inability of the Company to
obtain H-1B permits for certain of its employees in sufficient quantities or at
a sufficient rate could have a material adverse effect on the Company's
business, financial condition and results of operations. Furthermore, Congress
and administrative agencies with jurisdiction over immigration matters have
periodically expressed concerns over the levels of legal and illegal immigration
into the U.S. These concerns have often resulted in proposed legislation, rules
and regulations aimed at reducing the number of work permits that may be issued.
Any changes in such laws making it more difficult to hire foreign nationals or
limiting the ability of the Company to retain foreign employees could require
the Company to incur additional unexpected labor costs and expenses. Any such
restrictions or limitations on the Company's hiring practices could have a
material adverse effect on the Company's business, operating results and
financial condition.
INDUSTRY RISKS. Providers of temporary staffing services generally place
their employees in the workplace of other businesses. An attendant risk of such
activity includes possible claims of discrimination and harassment, employment
of illegal aliens and other similar claims. Management has adopted and
implemented policies and guidelines to reduce the Company's exposure to these
risks. However, a failure by any Company employee to follow these policies and
guidelines may result in negative publicity, injunctive relief and the
assessment against the Company of damages or fines. Moreover, in certain
circumstances, the Company may be held responsible for the actions at a
workplace of persons not under the direct control of the Company. Temporary
staffing providers are also affected by fluctuations in the business of their
clients. Interruptions in the business of its clients can adversely affect the
Company's business. For example, inclement weather or natural disasters, which
may require clients to close or reduce their hours of operation, could adversely
affect the Company's business, financial condition and results of operations.
RISKS RELATED TO ACQUISITION FINANCING. The Company currently intends to
continue to finance future acquisitions by using cash and shares of the
Company's Common Stock for all or a portion of the consideration to be paid. In
the event that the Common Stock does not maintain a sufficient market value, or
potential acquisition candidates are unwilling to accept the Company's Common
Stock as part of the consideration for their businesses, the Company may be
required to utilize its cash resources, if available, in its acquisition
program. If the Company does not have sufficient cash resources to pursue
acquisitions, its growth could be limited unless it is able to obtain additional
capital through debt or equity financing. Although the Company has established a
$175 million credit facility, there can be no assurance that the Company will
be able to obtain all the financing it will need in the near future on terms the
Company deems acceptable. The inability to acquire such financing, if needed,
could have a material adverse effect on the Company's business, financial
condition and results of operations.
RELIANCE ON KEY PERSONNEL. The Company is highly dependent on its
management. The Company believes that its success will depend to a significant
extent upon the efforts and abilities of the key executives of the Company.
Furthermore, the Company will likely be dependent on the senior management of
companies that may be acquired in the future. If any of these individuals are
unable to continue in their position with the Company, or if the
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Company is unable to attract and retain other skilled employees, the Company's
business, financial condition and results of operation could be adversely
affected.
POTENTIAL LIABILITY AND INSURANCE; LEGAL PROCEEDINGS. The provision of
Professional/IT services, Specialty Medical and clinical trials services entails
an inherent risk of professional malpractice and other similar claims. The
Company maintains insurance coverage that it believes is adequate both as to
risks and amounts. The Company believes that such insurance will extend to
professional liability claims that may be asserted against temporary associates
and consultants of the Company. In the ordinary course of its business, the
Company is periodically threatened with or named as a defendant in various
lawsuits, including discrimination and harassment and other similar claims,
which could have a material adverse effect on the Company's business, financial
condition and results of operations.
DIVIDEND POLICY; RESTRICTIONS ON PAYMENT. The Company anticipates that
for the foreseeable future its earnings will be retained for the operation and
expansion of its business and that it will not pay cash dividends. In addition,
the Company's credit facility limits the payment of cash dividends without the
lender's consent.
VOLATILITY OF STOCK PRICE. From time to time, there may be significant
volatility in the market price for the Common Stock. Quarterly operating results
of the Company or of other temporary staffing companies, changes in general
conditions in the economy, the financial markets or the staffing industry,
natural disasters or other developments could cause the market price of the
Common Stock to fluctuate substantially. In addition, in recent years the stock
market has experienced extreme price and volume fluctuations. This volatility
has had a significant effect on the market prices of securities issued by many
companies for reasons unrelated to their operating performance.
ANTI-TAKEOVER EFFECT OF CERTAIN CHARTER PROVISIONS. The Board of
Directors of the Company is empowered to issue preferred stock in one or more
series without stockholder action. The existence of this "blank-check" preferred
stock provision could render more difficult or discourage an attempt to obtain
control of the Company by means of a tender offer, merger, proxy contest or
otherwise. Certain provisions of the Delaware General Corporation Law may also
discourage takeover attempts that have not been approved by the Board of
Directors.
FORWARD LOOKING STATEMENTS. This Prospectus and documents incorporated
herein by reference contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995, including
statements made with respect to the results of operations and businesses of the
Company. When used in this Prospectus, the words "may," "should," "believe,"
"anticipate," "estimate," "expect," "intend," "plan," "provide," "meet,"
establish," "pursue," "feel," "work," "perform," "make," "continue," "can,"
"will," "target" or the negative thereof or variations thereon and similar
expressions are intended to identify forward-looking statements. These
forward-looking statements involve certain risks and uncertainties and are based
on management's current plans or assessments which are believed to be reasonable
as of the date of this Prospectus. These forward-looking statements involve
certain risks and uncertainties. Factors that may cause actual results to differ
materially from those contemplated, projected, forecast, estimated or budgeted
in such forward-looking statements include, among others, the following
possibilities: (i) heightened competition, including specifically the
intensification of price competition, the entry of new competitors, and new
services by new and existing competitors; (ii) failure to identify, acquire or
profitably manage additional businesses or successfully integrate acquired
businesses, if any, into the Company without substantial costs, delays or other
operational or financial problems; (iii) failure to obtain new customers or
retain existing customers; (iv) inability to carry out marketing and sales
plans; (v) inability to obtain capital for future internal and external growth;
(vi) loss of key executives; (vii) general economic and business conditions
which are less favorable than expected; and (viii) unanticipated changes in
industry trends. Such forward-looking statements may be found under this "Risk
Factors" section, in the documents incorporated by reference into this
Prospectus, as well as in this Prospectus generally. Actual events or
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results may differ materially from those discussed in the forward-looking
statements as a result of various factors, including, without limitation, the
risk factors set forth herein and the matters set forth in this Prospectus
generally.
THE COMPANY
The Company is a leading provider of diversified staffing, professional
and consulting services to businesses, professional and service organizations,
medical niches and governmental agencies. The Company offers its services
through over 200 branches located in 27 states, Canada, the United Kingdom, and
South Africa. On October 2, 1996, simultaneously with the closing of the initial
public offering (the "Initial Public Offering") of its Common Stock, StaffMark
acquired, in separate merger transactions (the "Mergers"), Brewer Personnel
Services, Inc. ("Brewer"), Prostaff Personnel, Inc. and its related entities
("Prostaff"), Maxwell Staffing, Inc. and its related entities ("Maxwell"), HRA,
Inc. ("HRA"), First Choice Staffing, Inc. ("First Choice"), and Blethen
Temporaries, Inc. and its related entities ("Blethen") (such entities are
sometimes collectively referred to as the "Founding Companies"). At the time of
the Initial Public Offering and the Mergers, the Founding Companies had on
average operated for over 13 years in eight states through over 90 branch
offices. The Company's principal executive offices are located at 302 East
Millsap Road, Fayetteville, Arkansas 72703, telephone (501) 973-6000. Unless
otherwise indicated, the term "Company" includes StaffMark, Inc. and its
subsidiaries.
The Company's staffing, professional and consulting services are provided
through the following three divisions:
Commercial Division. The Commercial division provides clerical and light
industrial staffing services. The Company's clerical services personnel include
secretarial, word processing personnel, receptionist/switchboard operators,
typists, data entry operators, cashiers, client service representatives,
medical/legal transcriptionists, file clerks and other miscellaneous office
personnel. Light industrial services personnel include warehouse workers,
maintenance workers, electronics assemblers, quality control clerks, order
pullers, food service workers, production workers, shipping/receiving clerks,
janitors, packagers, inventory clerks, textile manufacturers and machinists.
Professional/IT Division. The Professional/IT division provides
information technology staffing, consulting and support services and
professional and technical services. Information technology services include
systems planning and design, project management, software applications
development, systems and network implementation, distributed services, systems
integration and higher-level contract programming services, facilities
management, SAP development and implementation, system maintenance, computer
troubleshooting, outsourcing of legacy systems, Internet development, mainframe
programming, "help-desk" assistance and education and training. Within the
Professional/IT division, the Company also provides technical services personnel
such as drafters, designers and engineers in the mechanical and electrical
engineering and computer science fields, in addition to providing accounting
personnel, lawyers, paralegals, legal assistants and sales, marketing and human
resource professionals. The information technology services platform within the
Professional/IT division recently began operating under the brand name
"IntelliMark."
Specialty Niche Division. The Specialty Niche division provides clinical
trial support services, medical office staffing, physical and occupational
therapists and speech pathologists. The Company's clinical consultants support
the staffing demands of the pharmaceutical, biotechnology, medical device and
medical and clinical research data industries. The Company recruits, both
domestically and internationally, trained physical therapists, occupational
therapists and speech pathologists to work in a variety of healthcare settings.
The Company also provides complete physical therapy management and staffing
services to outpatient clinics as well as to rural and suburban acute care
hospitals. The Company also provides front office and clinical support for
physicians, medical offices and clinics in select markets.
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The Company has grown both internally and through the acquisition of
additional staffing and professional service companies. The Company believes
that a balance of internal growth and selective acquisitions will best allow the
Company to capitalize on its growth opportunities.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
Shares offered by the Selling Stockholders pursuant to this Prospectus.
SELLING STOCKHOLDERS
The following table sets forth certain information regarding the
beneficial ownership of the Common Stock of the Company as of June 11, 1998 and
as adjusted to reflect the sale of Common Stock offered pursuant to this
Prospectus by each of the Selling Stockholders. Such information has been
provided to the Company by the Selling Stockholders.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY SHARES BENEFICIALLY
OWNED OWNED
SELLING STOCKHOLDER: PRIOR TO THE OFFERING SHARES OFFERED HEREBY AFTER THE OFFERING
- ------------------- --------------------- --------------------- ------------------
<S> <C> <C> <C>
Mark Karpilovsky 287,566 287,566 -0-
Michael Shevelev 287,566 287,566 -0-
</TABLE>
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(1) Mr. Karpilovsky and Mr. Shevelev received their Shares of Common Stock
offered hereby in connection with the acquisition by the Company of Tribase
Systems, Inc.
PLAN OF DISTRIBUTION
The Shares may be sold from time to time by the Selling Stockholders or
their pledgees, distributees or donees. Such sales may be made from time to time
on the Nasdaq National Market or in other ways not involving market-makers or
established trading markets, including direct sales to purchasers or sales
affected through agents, at prices and at terms then prevailing, at prices
related to the then current market price or in negotiated transactions. The
Shares may be sold by one or more of the following: (a) a block trade in which
the broker or dealer so engaged will attempt to sell the Shares as agent, but
may position and resell a portion of the block as principal to facilitate the
transaction; (b) purchases by a broker or dealer as principal and resale by such
broker or dealer for its own account pursuant this Prospectus; (c) by bona fide
pledgees of Shares pursuant to loan and pledge agreements with the Selling
Stockholders; and (d) ordinary brokerage transactions in which the broker
solicits purchasers. In effecting sales, brokers or dealers may arrange for
other brokers or dealers to participate. Brokers or dealers will receive
commissions or discounts in amounts to be negotiated by the Selling
Stockholders.
The Shares may also be publicly offered through agents, underwriters or
dealers. In such event, the Selling Stockholders may enter into agreements with
respect to any such offering. Such underwriters, dealers or agents may receive
compensation in the form of underwriting discounts, concessions or commissions
from the
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Selling Stockholders and any such underwriters, dealers or agents that
participate in the distribution of the Shares may be deemed to be underwriters,
and any profit on the sale of the Shares by them and any discounts, commissions
or concessions received by them may be deemed to be underwriting discounts and
commissions under the Securities Act.
In order to comply with the securities laws of certain states, sales of
the Shares to the public in such states may be made only through broker-dealers
who are registered or licensed in such states. Sales of the Shares must also be
made by the Selling Stockholders in compliance with other applicable state
securities laws and regulations. In addition, any of the Shares covered by this
Prospectus which qualify for sale pursuant to Rule 144 under the Securities Act
may be sold under Rule 144 rather than pursuant to this Prospectus.
Mr. Karpilovsky and Mr. Shevelev have agreed not to sell or otherwise
dispose of their Shares of Common Stock until financial results covering at
least thirty (30) days of the Company's and Tribase Systems, Inc.'s combined
operations have been publicly reported (the "Pooling Period"). In addition,
following the expiration of the Pooling Period, Mr. Karpilovsky and Mr. Shevelev
must provide the Company with three (3) days prior written notice before placing
any sell order with respect to their Shares of Common Stock.
DESCRIPTION OF CAPITAL STOCK
The Company's authorized capital stock consists of 200,000,000 shares of
Common Stock and 10,000,000 shares of preferred stock, par value $.01 per share
(the "Preferred Stock"). As of July 1, 1998, the Company had 20,764,309 shares
of the Common Stock outstanding and no shares of the Preferred Stock
outstanding.
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LEGAL MATTERS
The validity of the issuance of the Shares of Common Stock offered by
this Prospectus has been passed upon for the Company by Gordon Y. Allison,
Executive Vice President - General Counsel of the Company. Mr. Allison is a
full-time employee of the Company. Mr. Allison holds options to purchase 45,000
shares of the Common Stock.
EXPERTS
The Company's consolidated financial statements for the year ended
December 31, 1997, incorporated in this Prospectus by reference to Form 10-K,
have been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their report with respect thereto, and are incorporated herein by
reference and reliance upon the authority of said firm as experts in giving such
reports.
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NO PERSON HAS BEEN AUTHORIZED IN CONNECTION WITH THIS OFFERING TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS AND,
IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES NOT CONSTITUTE AN
OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED
HEREBY TO ANY PERSON OR BY ANYONE IN ANY JURISDICTION IN WHICH IT IS UNLAWFUL TO
MAKE SUCH AN OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR
ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES CREATE ANY IMPLICATION
THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO
THE DATE HEREOF.
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TABLE OF CONTENTS
<TABLE>
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PAGE
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<S> <C>
Available Information............................ 2
Incorporation by Reference....................... 2
Risk Factors..................................... 3
The Company...................................... 7
Use of Proceeds.................................. 8
Selling Stockholders............................. 8
Plan of Distribution............................. 8
Description of Capital Stock..................... 9
Legal Matters.................................... 10
Experts.......................................... 10
</TABLE>
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575,132 SHARES
STAFFMARK, INC.
COMMON STOCK
$.01 PAR VALUE
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PROSPECTUS
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July 2, 1998
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