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As filed with the Securities and Exchange Commission on March 8, 1999
Registration No. 333-73365
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------------------
MASTECH CORPORATION
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
Pennsylvania 25-1802235
(State or other jurisdiction of (I.R.S. Employer
incorporation or Identification No.)
organization)
</TABLE>
1004 McKee Road
Oakdale, Pennsylvania 15071
412-787-2100
(Address, including ZIP code, and
telephone number, including area code,
of Registrant's principal executive offices)
Sunil Wadhwani
Co-Chairman and Chief Executive Officer
Mastech Corporation
1004 McKee Road
Oakdale, Pennsylvania 15071
412-787-2100
(Name, address, including ZIP code, and
telephone number, including area code,
of agent for service)
Copies to:
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<S> <C>
Carl A. Cohen, Esq. Stephen F. Ritner, Esq.
James J. Barnes, Esq. Steven & Lee
Buchanan Ingersoll Professional Corporation One Glenhardie Corporate Center
One Oxford Centre, 301 Grant Street, 20th Floor P.O. Box 236
Pittsburgh, Pennsylvania 15219-1410 Wayne, Pennsylvania 19084-4979
412-562-8800 610-293-4979
FAX 412-562-1041 FAX 610-687-1384
</TABLE>
Approximate date of commencement of proposed sale to the public: From time to
time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [ ]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to Section 8(a), may
determine.
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Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These Securities may not be sold, nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy, nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
PROSPECTUS
SUBJECT TO COMPLETION, DATED March 8, 1999
1,095,001 Shares
MASTECH CORPORATION
Common Stock
Par Value $.01
This prospectus relates to the public offering which is not being
underwritten, of up to 1,095,001 shares of our common stock. The common stock is
held by some of our current shareholders who are listed on page 13. The selling
shareholders obtained their shares on January 4, 1999, by virtue of a merger of
AMB Acquisition Corp., an indirect wholly-owned subsidiary of Mastech, with and
into The Amber Group.
The prices at which the selling shareholders may sell the shares will be
determined by the prevailing market price for the shares or in negotiated
transactions. We will not receive any of the proceeds from the sale of the
shares.
Our shares of common stock are quoted on the Nasdaq National Market under
the symbol "MAST." The reported closing sale price for our common stock on
March 3, 1999 was $24.75 per share.
You should carefully review the "Risk Factors" beginning on page 7 for
a discussion of certain factors that should be considered in connection with an
investment in the common stock offered hereby.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined that
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.
No person has been authorized to give any information or to make any
representations other than those contained in this prospectus in connection with
the offering made hereby, and if given or made, such information or
representations must not be relied upon as having been authorized by Mastech,
any selling shareholder or by any other person. Neither the delivery of this
prospectus nor any sale made hereunder shall, under any circumstances, create
any implication that information herein is correct as of any time subsequent to
the date hereof. This prospectus does not constitute an offer to sell or a
solicitation of an offer to buy any security other than the securities covered
by this prospectus, nor does it constitute an offer to or solicitation of any
person in any jurisdiction in which such offer or solicitation may not lawfully
be made.
The date of this Prospectus is March ________, 1999
<PAGE>
SUMMARY
Mastech Corporation is a worldwide provider of information technology
("IT") services to large and medium-sized organizations. We provide our clients
with a single source for a broad range of applications solutions and services,
including client/server design and development, conversion/migration services,
Year 2000 services, Enterprise Resource Planning package implementation
services, Internet/intranet services and applications maintenance outsourcing.
We provide these services in a variety of computing environments and use leading
technologies, including client/server architectures, object-oriented programming
languages and tools, distributed database management systems and the latest
networking and communications technologies. To enhance our services, we have
formed business alliances with leading software companies such as Baan, Oracle,
PeopleSoft and SAP. In addition, we have developed our own proprietary
methodologies and tools, under the name SmartAPPS, that enhance the productivity
of our Year 2000 and other services.
Our revenues have grown from $13.5 million in 1991 to $390.9 million in
1998. During 1998, we provided IT services to over 900 clients worldwide in a
diverse range of industries. These clients include AT&T, Citibank, EDS, IBM,
Intel, Oracle and Wal-Mart. We set high standards for client responsiveness and
project quality. A significant number of our clients have selected us on a
recurring basis to provide additional services.
We believe that the growth of the IT services industry offers us
significant opportunities and we have developed a set of strategies that we
believe differentiate us from our competitors. These strategies include: (i) the
development of a global recruitment network through which we recruit and deploy
qualified IT professionals from a number of countries to address the shortage of
IT professionals in the U.S. and other developed countries; (ii) a focus on
applications services including ERP package implementation, Year 2000 and
Internet/intranet services; (iii) the development of proprietary technology,
including an automated tool for Year 2000 code conversions and other programming
language translations; (iv) international expansion to leverage the growing need
for value-added IT services in areas outside the U.S.; and (v) the development
of an extensive offshore software development infrastructure to provide cost
advantages to clients that are increasingly short of resources.
One of the key elements of our growth has been our ability to recruit and
deploy, on short notice, experienced IT professionals on a worldwide basis. As
of December 31, 1998, we employed approximately 4,800 IT professionals, over 65%
of whom were in the U.S., with the remainder in Canada, Europe, the Middle East,
Singapore, Japan, India and Australia. To support our growth and to meet the
increased demand for IT professionals, we have embarked on an aggressive
recruiting strategy, designed to significantly increase the number of IT
professionals hired. We have also established a network of training centers at
which we train new recruits in value-added technologies such as PeopleSoft,
Oracle Applications, SAP, Java/HTML and Year 2000 solutions.
In 1995, we began marketing our services in key international markets to
meet the large and growing demand for IT services overseas and to serve our
client base of large multinational corporations that need support on a global
basis. In addition to offices in the U.S., we maintain international offices in
Toronto, Singapore, London, Sydney, Tokyo, Amsterdam, Switzerland, Sweden and
the Middle East. As a result of our expanding international operations, as of
December 31, 1998, we had over 1,700 employees working with over 500 clients
outside the U.S.
To provide cost advantages to clients that are increasingly short of
resources, we are investing in an extensive offshore software development
infrastructure in India, including three state-of-the-art software development
centers. The center in Bangalore, India has been operational for over a year and
two additional centers are under development in Pune and Madras, India. We
believe that this offshore infrastructure, with the ability to accommodate
1,500 IT professionals when complete, will represent one of the largest offshore
presences in the industry. The Company maintains its principal executive offices
at 1004 McKee Road, Oakdale, PA 15071. The Companys World Wide
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Web address is www.mastech.com. The Company's Web site is not part of this
Prospectus. The Company's telephone number is (412) 787-2100.
RECENT DEVELOPMENTS
We recently issued on February 8, 1999 a press release announcing that
our revenues for the twelve months ended December 31, 1998 were $390.9 million,
a 63% increase over revenues of $240.4 million for the same period in 1997.
Excluding one-time merger-related expenses, net income for the twelve month
period of 1998 was $36.6 million or $.73 per diluted share which represents a
per diluted share increase of 109% compared to net income of $16.1 million or
$.35 per diluted share for the same period a year ago. After one-time merger
related expenses, net income increased to $33.4 million or $.67 per diluted
share, which represents a 91% increase over last year. These results have not
yet been audited by our accountants.
On January 29, 1999, we acquired all of the issued and outstanding stock of
Global Resource Management, an information technology services firm located in
Jacksonville, Florida. This transaction was accounted for as a cash purchase of
shares.
On January 8, 1999, we acquired all of the issued and outstanding stock of
Direct Resources Scotland LTD, which was accounted for as a cash purchase of
shares. Direct Resources Scotland Limited, located in Edinburg, Scotland, is an
IT services firm focusing on the financial services industry.
On January 4, 1999, we also acquired all of the issued and outstanding
stock of The Amber Group in a merger transaction and in exchange for 1,095,001
shares of our common stock which was accounted for as a pooling of interests.
The Amber Group became an indirect wholly-owned subsidiary of us and we plan to
operate it in much the same way as it was operated prior to the merger.
On October 28, 1998 the Company announced the acquisition of International
MIS, Inc. ("IMIS"), a business and information technology consulting firm based
in San Francisco, CA. IMIS provides the financial industry with high-level
project management and business analysis consulting services. The acquisition
was accounted for as a purchase. Operating results have been included in the
Company's consolidated financial statements since the date of acquisition, but
pro forma information has not been presented because it is immaterial.
REVOLVING CREDIT FACILITY
Effective December 3, 1998, the Company entered into a $75.0 million
revolving credit facility ("the Credit Facility"). This Credit Facility bears
an interest rate equal at a rate per annum equal to a base rate which shall be
adjusted by a change in the Prime rate or the Federal Funds Effective Rate or
at the Company's option, at a rate equal to the sum of the Euro-rate plus an
applicable Euro-rate margin. The Credit Facility contains certain restrictive
covenants and financial ratio requirements which would limit distributions to
shareholders and additional borrowings. There were no borrowings outstanding
under this arrangement as of December 31, 1998. Average outstanding
borrowings under this arrangement were approximately $161,000 for the year
ended December 31, 1998.
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RISK FACTORS
Before you invest in our common stock, you should be aware that there are
various risks, including those described below. You should consider carefully
these risk factors together with all of the other information included in this
Prospectus before you decide to purchase our common stock.
This Prospectus contains forward-looking statements and information
relating to Mastech. We intend to identify forward-looking statements in this
Prospectus using words such as "believes," "intends," "expects," "may," "will,"
"should," "plan," "projected," "contemplates," "anticipates," or similar
statements.
These statements are based on our beliefs as well as assumptions we made
using information currently available to us. Because these statements reflect
our current views concerning future events, these statements involve certain
risks, uncertainties and assumptions. Actual future results may differ
significantly from the results discussed in the forward-looking statements.
Some, but not all, of the factors that may cause such a difference include those
discussed below.
----------------
Mastech(R) and SmartAPPS/SM/ are service marks of the Company. Windows(R)
is a registered trademark of Microsoft Corporation. All other trademarks,
service marks and trade names referred to in this Prospectus are the property of
their respective owners.
Failure to Recruit, Train and Retain Skilled IT Professionals Could Increase
Costs or Limit Growth
We need to recruit and retain highly trained professionals in order to
deliver our IT services to our clients. Our continued success depends upon our
ability to attract, develop, motivate and retain highly skilled IT professionals
and project managers with the technical skills and experience necessary to
deliver our services to our clients. The qualified IT professionals we require
are in high demand worldwide and are likely to remain a limited resource for the
foreseeable future. We cannot be certain that we will be able to attract or
retain the IT professionals that we seek. Failure to attract or retain
qualified IT professionals in sufficient numbers could have a material adverse
effect on our business, operating results and financial condition.
Historically, we have done most of our recruiting outside of the countries
where the client work is performed. Accordingly, any perception among our IT
professionals, whether or not well founded, that our ability to assist them in
obtaining temporary work visas and permanent residency status has been
diminished, could lead to significant employee attrition. In the first eight
months of 1996, we experienced a higher than normal rate of employee attrition
because we were experiencing delays in securing the first-stage approval for
permanent residency status for our foreign employees working in the U.S. This
attrition resulted in us incurring increased costs for IT professionals and a
reduction in our revenue growth.
Impact of Government Regulation of Immigration Could Limit Growth
We recruit IT professionals globally to create a workforce that can be
deployed wherever required by our clients. As a result, we must comply with the
immigration laws in the countries in which we operate, particularly the United
States. As of December 31, 1998, approximately 37% of our worldwide workforce
was working under H-1B temporary work permits in the United States. Government
regulation limits the number of new H-1B permits that may be approved in a
fiscal year. As of October 1998, the cap on H-1B visas permitted for the fiscal
year is 115,000. This cap will remain at 115,000 for fiscal year 2000, drop to
107,500 in 2001 and revert to its original cap of 65,000 in 2002. If the limit
is reached in any year, we may not be able to recruit enough IT professionals to
meet our personnel requirements. This could materially affect our business.
Congress and administrative agencies with jurisdiction over immigration matters
have periodically expressed concern over the level of legal and illegal
immigration into the United States. These concerns have often resulted in
proposals aimed at reducing the number of work permits that may be issued. Any
change making it more difficult for us to hire foreign nationals, or limiting
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our ability to retain foreign employees, could require us to incur additional
unexpected labor costs and other expenses.
Variability of Quarterly Operating Results
Our revenues and operating results can vary from quarter to quarter
depending on a number of factors, including:
- The timing and number of client projects commenced and completed
during a quarter;
- The number of working days in a quarter;
- Employee hiring, attrition and utilization rates;
- Progress on fixed-price projects during a quarter;
- The consummation of acquisitions;
- The ability of clients to terminate engagements without penalty;
- General economic conditions.
Because a high percentage of our expenses are fixed, such as personnel and
facilities costs, a variation in revenues may cause a significant variation in
our quarterly operating results and could result in losses. Also, our costs
periodically increase due to the hiring of new employees and the making of
strategic investments in infrastructure in anticipation of future opportunities
for revenue growth.
Increasing Significance and Risks of Non-U.S. Operations
Our international consulting and offshore software development operations
accounted for approximately 28% of our total revenues for the twelve month
period ended December 31, 1998. Our international operations and international
business activities are subject to the following risks:
- Unexpected changes in regulatory environments;
- Foreign currency fluctuations;
- Tariffs and other trade barriers;
- Difficulty in managing international operations;
- Potential foreign tax consequences, including repatriation of
earnings;
- Burden of complying with a wide variety of foreign laws and
regulations;
- Unexpected changes in the local and regional political climate and the
possible reaction to those changes by the international community,
including economic sanctions;
- Risk of increased duties, taxes and governmental royalties;
- Changes in laws and policies governing operations of foreign-based
companies; and
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- Risk of a significant interruption in our ability to transmit data via
satellite.
Our international operations greatly depend upon business and technology
transfer laws and related restrictions and upon continued development of
technology infrastructure. We cannot be certain that our international
operations will continue to be profitable or support our growth strategy.
Although our ownership of a U.S. trademark registration covering the
service mark "Mastech" gives us the presumption of ownership in the U.S. of
the "Mastech" mark for the services identified in the registration, there can
be no assurance that we are entitled to use the designation "Mastech" in all
international operations and there is the possibility that third parties have
superior rights to the "Mastech" mark (or similar marks) outside the U.S.
Exposure to Regulatory, Political and General Economic Conditions in India
A significant element of our business strategy is to expand our offshore
software development centers in Bangalore, Pune and Madras, India. As of
December 31 1998, approximately 10% of our workforce was located in India. We
benefit directly from certain incentives provided by the Indian government to
encourage foreign investment, including tax holidays which are temporary
exemptions from taxation on operating income granted by Indian Authorities and
liberalized import and export duties. If the Indian government changes any of
these incentives, it could negatively impact the profitability of our Indian
operations.
Although wage costs in India are significantly lower than in the U.S. and
elsewhere for comparably skilled IT professionals, wages in India are increasing
at a faster rate than in the U.S. In the past, India has experienced significant
inflation and shortages of foreign exchange, and has been subject to civil
unrest and acts of terrorism. Changes in inflation, interest rates, taxation or
other social, political, economic or diplomatic developments affecting India in
the future could have a material adverse effect on our business, operating
results and financial condition.
We Operate in Highly Competitive Markets
The IT services industry is highly competitive, undergoing consolidation
and is served by many national, regional and local firms, all of which are
either existing or potential competitors. Our primary competitors include
Cambridge Technology Partners, Inc., IMR Global Corp., Keane, Inc., Whittman-
Hart, Inc. and participants within a variety of market segments, including:
- Large accounting firms;
- Implementation firms;
- Software applications firms;
- Service groups of computer equipment companies;
- General management consulting firms; and
- Programming companies and temporary staffing firms.
Many of these competitors have substantially greater resources and greater
name recognition than we do. In addition, there are relatively few barriers to
entry into our markets. We have faced, and we expect to continue to face,
additional competition from new entrants into our markets. In addition, clients
may increase their use of internal IT resources to satisfy their applications
solutions needs instead of engaging us. Each of these competitive factors may
limit our ability to increase prices commensurate with increases in labor costs
which could result in reduced margins.
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We cannot be certain that we will be able to compete successfully with existing
or new competitors.
Concentration of Revenues; Risk of Termination
We have in the past derived, and may in the future derive, a significant
portion of our revenues from a relatively limited number of clients. Our five
largest clients represented approximately 23% of revenues for the year ended
December 31, 1998. EDS accounted for approximately 11% of our revenues for the
year ended December 31, 1998. Most of our projects are terminable by the client
without penalty. An unanticipated termination of a major project could result in
the loss of substantial anticipated revenues and could require us to maintain or
terminate a significant number of unassigned IT professionals, resulting in a
higher number of unassigned IT professionals and/or significant termination
expenses. The loss of any significant client or project could have a material
adverse effect on our business, operating results and financial condition.
Failure to Properly Manage Growth Could Adversely Affect Our Business
As a result of our internal growth and acquisition strategy, we have
experienced a rapid increase in the number of branch locations, the number of
employees and revenues. Since 1995, we have added offices in Canada, Singapore,
Japan, the U.K., Australia, the Netherlands, the Middle East, Switzerland and
Dallas, Texas. This rapid growth has placed significant demands on our
managerial, administrative and operational resources. Effective management of
our growth will require us to continue to improve our operational, financial and
other management processes and systems and to quickly and efficiently to
integrate acquired businesses. We cannot be sure that we will continue to grow
or that we will be able to manage our growth.
Rapid Technological Change; Dependence on New Solutions
The IT services industry is characterized by rapid technological change,
evolving industry standards, changing client preferences and new product
introductions. Our success will depend in part on our ability to develop IT
solutions that keep pace with changes in the IT services industry. There can be
no assurance that we will be successful in addressing these developments on a
timely basis or that, if these developments are addressed, we will be successful
in the marketplace. In addition, there can be no assurance that products or
technologies developed by others will not render our services uncompetitive or
obsolete. Our failure to address these developments could have a material
adverse effect on the Company's business, operating results and financial
condition.
A significant number of organizations are attempting to migrate business
applications from a mainframe environment to advanced technologies, including
client/server architectures. As a result, our ability to remain competitive will
be dependent on several factors, including our ability to help existing
employees maintain or develop mainframe skills and to train and hire employees
with skills in advanced technologies. The failure to hire, train and retain
employees with such skills could have a material adverse impact on our business.
Our ability to remain competitive will also be dependent on our ability to
design and implement, in a timely and cost-effective manner, effective
transition strategies for clients moving from the mainframe environment to
client/server or other advanced architectures. Our failure to design and
implement such transition strategies in a timely and cost-effective manner could
have a material adverse effect on our business, operating results and financial
condition.
Dependence on Principals
Our success is highly dependent on the efforts and abilities of Sunil
Wadhwani and Ashok Trivedi, the Company's Co-Chairman and Chief Executive
Officer and the Company's Co-Chairman and President, respectively. Although
Messrs. Wadhwani and Trivedi have entered into employment agreements containing
noncompetition, nondisclosure and nonsolicitation covenants, these contracts do
not guarantee that they will continue their employment with the Company or that
such covenants will be enforceable. The loss of the services of either of these
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key executives for any reason could have a material adverse effect on our
business, operating results and financial condition.
Risk of Preferred Vendor Contracts
We are a party to several "preferred vendor" contracts and are seeking
additional similar contracts in order to obtain new or additional business from
large or medium-sized clients. Clients enter into these contracts to reduce the
number of vendors and obtain better pricing in return for a potential increase
in the volume of business to the preferred vendor. While these contracts are
expected to generate higher volumes, they generally result in lower margins.
Although we attempt to lower costs to maintain margins, there can be no
assurance that we will be able to sustain margins on such contracts. In
addition, the failure to be designated a preferred vendor, or the loss of such
status, may preclude us from providing services to existing or potential
clients, except as a subcontractor, which could have a material adverse effect
on our business, operating results and financial condition.
Failure to Properly Manage Acquisitions Could Adversely Affect Our Business
We have expanded, and plan to continue to expand, our operations through
the acquisition of additional businesses that complement our core skills and
have the potential to increase our overall value. We may not be able to
continue to identify and acquire businesses with which we are compatible.
Acquisitions involve a number of special risks, including:
- Diversion of management's attention;
- Potential failure to retain key acquired personnel;
- Assumption of unanticipated legal liabilities and other problems;
- Difficulties integrating systems, operations and cultures;
- Amortization of acquired intangible assets; and
- Potential dilution of earnings per share.
Since our initial public offering in December, 1996, we have made 7
acquisitions. We may not be able to profitably manage these acquired businesses
or successfully integrate any acquired businesses without substantial expense,
delay or other operational or financial problems. Our reputation is a valuable
asset and performance problems and client dissatisfaction with an acquired firm
could adversely affect our reputation. In addition, we cannot be certain that
an acquired business will achieve anticipated revenues and earnings. Failure to
manage our acquisition strategy successfully could have an adverse effect on our
business.
Limited Protection of Intellectual Property Rights
Our success depends in part upon certain methodologies we utilize in
providing IT services to our clients. We have not registered copyrights to such
methodologies, which may impair our ability to protect these methodologies. We
rely upon a combination of nondisclosure and other contractual arrangements and
trade secret, copyright and trademark laws to protect our proprietary rights and
the proprietary rights of third parties from whom we license intellectual
property.
We enter into confidentiality agreements with our employees and limit the
distribution of proprietary information. However, we cannot be sure that these
steps will be adequate to deter misappropriation of proprietary information or
that we will be able to detect unauthorized use of and take appropriate steps to
enforce our intellectual property rights.
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The laws of certain foreign countries in which our services are, or may
be, developed or sold may not protect our services or intellectual property
rights to the same extent as do the laws of the U.S. This lack of protection may
impair our ability to adequately protect our intellectual property.
Although we do not believe that our services infringe on the rights of
third parties, third parties may nevertheless make infringement claims against
us in the future. Such claims may result in costly litigation or require us to
obtain a license for such intellectual property rights.
Limited Trading History of Common Stock; Stock Price Volatility
Our common stock first became publicly traded on December 17, 1996 after
our initial public offering at $15 per share. On April 10, 1998, we effected a
two-for-one stock split. Between December 17, 1996 and December 31, 1998, the
closing sale price has ranged from a low of $5 3/4 per share to a high of $29
29/32 per share (adjusted to reflect the April 10, 1998 stock split). The market
price of the common stock could continue to fluctuate substantially due to a
variety of factors, including quarterly fluctuations in results of operations,
adverse circumstances affecting the introduction or market acceptance of new
products and services we offer, announcements of new products and services by
competitors, changes in the IT environment, changes in earnings estimates by
analysts, changes in accounting principles, sales of common stock by existing
holders, loss of key personnel and other factors. The market price for our
common stock may also be affected by our ability to meet analysts' expectations,
and any failure to meet such expectations, even if minor, could have a material
adverse effect on the market price of our common stock. In addition, the stock
market is subject to 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 the operating performance of these companies.
In the past, following periods of volatility in the market price of a company's
securities, securities class action litigation has often been instituted against
such a company. Any such litigation instigated against us could result in
substantial costs and a diversion of management' s attention and resources,
which could have a material adverse effect on our business, operating results
and financial condition.
Our Co-Chairmen's Share Ownership Provides Substantial Control Over Our Company
Messrs. Wadhwani and Trivedi beneficially own approximately 60.6% of, and
have voting power over approximately 42.3% of our common stock. Messrs. Wadhwani
and Trivedi, as a practical matter, are able to elect the entire Board of
Directors and to control or veto certain matters requiring shareholder approval,
possibly excluding certain fundamental transactions such as a merger,
consolidation or the sale of substantially all of our assets, which under our
Articles of Incorporation requires the approval of the holders of 66 2/3% of the
votes cast. Messrs. Wadhwani and Trivedi have entered into a shareholders
agreement requiring each of them to vote their shares of common stock in favor
of the other in the election of directors. The approval of the Government of
India/Reserve Bank of India will be required for us to continue to own Mascot
Systems Private Limited ("Mascot Systems") and Scott Systems Private Limited
("Scott Systems") if our ownership by persons of Indian origin, in the
aggregate, falls below 60% (based on voting power). Our ability to raise
additional capital by the issuance of our common stock or voting preferred stock
or to sell control of the company to a third party or to use our common stock to
acquire other businesses may be restricted if we are unable to obtain the
required approval.
Demand for Year 2000 Services Will Decrease
During the twelve month period ended December 31, 1998, we realized
approximately 10% of our total revenues from Year 2000 engagements. We expect
the number of Year 2000 engagements and revenues derived from such engagements
to peak prior to calendar year 2000 as companies become Year 2000 compliant. To
maintain our current level of operations, we will need to obtain revenue from
other sources and types of engagements to replace the revenue lost due to the
decline in Year 2000 engagements.
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Anti-Takeover Provisions
Certain provisions of our Articles of Incorporation, as amended and the
Pennsylvania Business Corporation Law will effectively make it more difficult
for a third party to acquire control of us by means of a tender offer or a proxy
contest for the election of directors or otherwise. Our Articles of
Incorporation contain provisions which: (i) classify the Board of Directors into
three classes, with one class being elected each year; (ii) require the approval
of holders of 66 2/3% of the votes cast on a proposal to amend the Articles of
Incorporation, effect a merger or consolidation of the company, sell, lease or
exchange all or substantially all of our assets or dissolve and wind-up our
affairs, unless any such proposal is unanimously approved by all of our
directors; and (iii) require the approval of four of the company's five
directors for action by the Board of Directors. These provisions may have the
effect of lengthening the time required for a person to acquire control of the
company through a proxy contest for the election of a majority of the Board of
Directors, may discourage bids for our common stock at a premium over the market
price and may deter efforts to obtain control of the company.
Our Fixed-Price Projects Contain Cost Overrun Risks
We undertake certain projects on a fixed-price basis, as distinguished from
billing on a time-and-materials basis. We realized approximately 2.0% of our
revenues from fixed-price projects during the twelve month period ended December
31, 1998. Significant cost overruns can occur if we fail to:
- Adequately estimate the resources required to complete a project;
- Properly determine the scope of an engagement; or
- Complete our contractual obligation in a manner consistent with the
project plan.
The potential for costs overruns may be heightened if we act as a
subcontractor on a fixed-price project, because we have a limited ability to
control project variables and to negotiate directly with the ultimate client.
We cannot be certain that any of our existing or future fixed-price projects
will be profitable.
Potential Liability to Clients
Many of our engagements, including Year 2000 projects, involve projects
that are critical to the operation of our clients' businesses and provide
benefits that may be difficult to quantify. We attempt to contractually limit
our liability for damages arising from errors, mistakes, omissions or negligent
acts in rendering our services. We cannot be sure that our attempts to limit
liability will be successful. If we fail to meet a client's expectations in the
execution of our services, it could result in an adverse change to our client's
operations. This could give rise to claims against us or damage our reputation,
which could adversely affect our business.
Absence of Dividends
We do not anticipate paying any dividends on our common stock in the
foreseeable future. Our ability to pay dividends is subject to the requirement
of our revolving credit facility with PNC Bank that we satisfy certain financial
covenants.
Forward-Looking Statements and Associated Risks
Included in this Prospectus are various forward-looking statements,
including, among others, the expected growth related to the Year 2000 problem,
our goals and strategies, the importance and expected growth of the IT
applications solutions market, the pace of change in the IT marketplace, the
demand for IT services, our ability to capitalize on offshore investments and
infrastructure, our goal to expand service offerings and to pursue acquisitions,
and the ability to leverage Year 2000 engagements into additional contracts.
10
<PAGE>
These statements are forward-looking and reflect our current expectations.
Such statements are subject to a number of risks and uncertainties, including,
but not limited to, changes in the economic and political environments, changes
in technology and changes in the IT marketplace. In light of the many risks and
uncertainties surrounding our operations and the IT marketplace, you should keep
in mind that there can be no assurance that the forward-looking statements
described in this Prospectus will transpire.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
SEC's public reference rooms in Washington, D.C., New York, New York and
Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further
information on the public reference rooms. Our SEC filings are also available
to the public through the SEC's site on the Internet's World Wide Web located at
http://www.sec.gov. Our common stock is traded on the Nasdaq National Market
and, as such, reports and other information concerning Mastech can also be
inspected at the offices of the National Association of Securities Dealers,
Inc., in Washington, D.C.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus, and later information filed with the
SEC will update and supersede this information. We incorporate by reference the
documents listed below and any future filings made with the SEC under
Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as
amended, until our offering is completed:
-- Annual Report on Form 10-K, for the fiscal year ended December 31,
1997;
-- Quarterly Report on Form 10-Q for the quarterly periods ending
March 31, June 30 and September 30, 1998; and
-- The description of the Common Stock, which is registered under Section
12 of the Exchange Act, contained in the Company's registration
statement on Form 8-A, filed with the Commission on November 19, 1996.
-- All other reports and other documents filed by the Company since
December 31, 1997, pursuant to Section 13(a), (c), 14 or 15(d) of the
Exchange Act.
You may request a copy of these filings at no cost, by writing or
telephoning us at the following address or telephone number: Mastech
Corporation, 1004 McKee Road, Oakdale, Pennsylvania 15071, Attention: Jeffrey
McCandless, Vice President of Finance, telephone: 412-787-2100. Our Internet
address is http://www.Mastech.Com
You should rely only on the information incorporated by reference or
provided in this prospectus or the prospectus supplement. We have authorized no
one to provide you with different information. We are not making an offer of
these securities in any state where the offer is not permitted. You should not
assume that the information in this prospectus or the prospectus supplement is
accurate as of any date other than the date on the front of the document.
11
<PAGE>
USE OF PROCEEDS
We will not receive any proceeds from the sale of common stock by the
selling shareholders.
12
<PAGE>
SELLING SHAREHOLDERS
The following table sets forth, as of March 4, 1999, certain information
regarding the beneficial ownership of common stock subject to resale under this
Prospectus by each selling shareholder, and the shares which may be offered by
each from time to time hereby. Each Selling Shareholder is employed by Mastech
and is a former shareholder of Amber Group, Inc., which was acquired by Mastech
on January 4, 1999. Unless otherwise indicated, each person has sole voting and
sole dispositive power with respect to the shares he beneficially owns.
<TABLE>
<CAPTION>
Beneficial Ownership
------------------------------------------------------------------
Number of Shares
Selling Shareholders Prior to the Offering Offered After the Offering
- ----------------------- --------------------- ----------------- ----------------------
Number Percent Number Percent
--------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Robert Detwiler 407,888 37.25 0 0
Michael P. Flaherty 407,888 37.25 0 0
Jeffrey Doerzbacher 93,075 8.50 0 0
Charles Ganse 93,075 8.50 0 0
Gary L. Keller, Jr. 93,075 8.50 0 0
--------- ---------- ---------- ----------
Total 1,095,001 100%
--------- ----------
</TABLE>
PLAN OF DISTRIBUTION
The shares of common stock being offered by the Selling Shareholders or
anyone to whom they legally transfer such stock may be sold from time to time in
one or more transactions. Alternatively, a Selling Shareholder may from time to
time offer the Shares through underwriters, dealers or agents who may receive
compensation in the form of underwriting discounts, concessions or commissions
from the Selling Shareholder and/or the purchasers of the Shares for whom they
may act as agents.
The Shares being offered by the Selling Shareholder(s) may be sold on the
Nasdaq National Market or the over-the-counter market or otherwise at prices and
on terms then prevailing or at prices related to the then-current market price,
or in negotiated transactions. Such prices will be determined by the Selling
Shareholder or by agreement between the Selling Shareholder and underwriters or
dealers.
The Shares sold pursuant to this prospectus may be sold in or by (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 subsequent resale by such broker or dealer for its account pursuant to this
prospectus, (c) an exchange distribution in accordance with the rules of such
exchange, (d) ordinary brokerage transactions and transactions in which the
broker solicits purchases, and (e) privately negotiated transactions. In
effecting sales, brokers or dealers engaged by the selling shareholder may
arrange for other brokers or dealers to participate. A Selling Shareholder also
may, from time to time with our consent, authorize underwriters acting as his
agent to offer and sell his shares upon such terms and conditions as shall be
set forth in any prospectus supplement. Underwriters, brokers or dealers will
receive commissions or discounts from a Selling Shareholder in amounts to be
negotiated. Such underwriters, brokers or dealers and any other participating
brokers or dealers may be deemed to be "underwriters" within the meaning of the
Securities Act of 1933, as amended, in connection with such sales and any
discounts and commissions received by them, and any
13
<PAGE>
profit realized by them on the resale of the Shares may be deemed to be
underwriting discounts and commissions under the Securities Act.
In connection with distributions of the Shares or otherwise, the Selling
Shareholders may enter into hedging transactions with broker-dealers. In
connection with such transactions, broker-dealers may engage in short sales of
the Shares registered hereunder in the course of hedging the positions they
assume with the Selling Shareholders. The Selling Shareholders may also sell
Shares short and deliver the Shares to close out such short positions. The
Selling Shareholders may also enter into option or other transactions with
broker-dealers which require the delivery to the broker-dealer of the Shares
registered hereunder, which the broker-dealer may resell pursuant to this
prospectus.
The Selling Shareholders may also pledge the shares registered hereunder to
a broker or dealer and upon a default, the broker or dealer may effect sales of
the pledged Shares pursuant to this prospectus.
Any dealer or broker participating in any distribution of the shares may be
required to deliver a copy of this prospectus, including the prospectus
supplement, if any, to any person who purchases any of the Shares from or
through such dealer or broker.
In order to comply with certain state securities laws, if applicable, the
Shares will be sold in such jurisdictions only through registered or licensed
brokers or dealers. In certain states, the Shares may not be sold unless they
have been registered or qualified for sale in such state or an exemption from
registration or qualification is available and is complied with.
Under applicable rules and regulations under the Exchange Act, any person
engaged in a distribution of the Shares may not simultaneously engage in market-
making activities with respect to such Shares, except in accordance with
applicable laws. The Selling Shareholders and any other persons participating
in the sale or distribution of the shares of common stock will be subject to
applicable provisions of the Exchange Act and the rules and regulations
thereunder which may limit the timing of purchases and sales of those persons.
The foregoing may affect the marketability of the Shares.
Pursuant to certain contractual obligations, we have agreed to pay all the
fees and expenses incident to the registration of the Shares , and up to $5,000
in the aggregate of fees and expenses of one law firm representing all of the
Selling Shareholders. In addition, the company has agreed to maintain the
effectiveness of the Registration Statement until the earlier of (i) such time
as all of the shares registered hereunder have been sold pursuant to this
prospectus supplement or (ii) the second anniversary of the acquisition of the
shares by the selling shareholders (on or about January 4, 2001). We have also
agreed to indemnify the Selling Shareholders against certain liabilities,
including liabilities under the Securities Act. In addition, each of the
Selling Shareholders has agreed to indemnify us against certain liabilities,
including liabilities under the Securities Act.
LEGAL MATTERS
The validity of the Shares will be passed upon for the Company by Buchanan
Ingersoll Professional Corporation, Pittsburgh, Pennsylvania. Carl A. Cohen, a
shareholder of Buchanan Ingersoll Professional Corporation, owned 2,000 shares
of Common Stock as of December 31, 1998.
EXPERTS
The consolidated financial statements and related financial statement
schedules incorporated by reference in this prospectus as of December 31, 1997
and 1996 and for each of the three years ended December 31, 1997, 1996 and 1995
have been audited by Arthur Andersen LLP, independent public accountants, to the
extent and for the periods as indicated in their reports with respect thereto,
and are incorporated herein by reference in reliance upon the authority of said
firm as experts in giving said reports.
14
<PAGE>
With respect to the unaudited interim financial information for the
quarters ended March 31, 1998, June 30, 1998 and September 30, 1998, Arthur
Andersen LLP has applied limited procedures in accordance with professional
standards for a review of that information. However, their separate report
thereon states that they did not audit and they do not express an opinion on
that interim financial information. Accordingly, the degree of reliance on their
report of that information should be restricted in light of the limited nature
of the review procedures applied. In addition, the accountants are not subject
to the liability provisions of Section 11 of the Securities Act of 1933 for
their report on the unaudited interim financial information because that report
is not a "report" or a "part" of the registration statement prepared or
certified by the accountants within the meaning of Section 7 and 11 of the Act.
15
<PAGE>
================================================
NO DEALER, SALESPERSON, OR ANY OTHER PERSON
HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR
TO MAKE ANY REPRESENTATION NOT CONTAINED IN
THIS PROSPECTUS IN CONNECTION WITH THE OFFERING
MADE HEREBY, AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION 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 IN
ANY JURISDICTION TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION
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 OR THAT THE INFORMATION CONTAINED HEREIN
IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE
DATES AS OF WHICH SUCH INFORMATION IS
FURNISHED.
______________
TABLE OF CONTENTS
PAGE
----
SUMMARY.................................. 2
RISK FACTORS............................. 4
WHERE YOU CAN FIND MORE INFORMATION...... 11
INCORPORATION OF CERTAIN
DOCUMENTS BY REFERENCE................... 11
USE OF PROCEEDS.......................... 12
SELLING SECURITY HOLDERS................. 13
PLAN OF DISTRIBUTION..................... 13
LEGAL MATTERS............................ 14
EXPERTS.................................. 14
===============================================
===============================================
1,095,001 Shares
MASTECH
CORPORATION
Common Stock
_______________
PROSPECTUS
_______________
, 1999
-------------
===============================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The estimated expenses of this offering in connection with the distribution
of the Common Stock being registered hereby, all of which are to be borne by the
Registrant, are as follows:
SEC registration fee $ 7,439
Accounting fees and expenses....................... $ 1,000
Legal fees and expenses............................ $ 7,500
Printing........................................... $ 750
Miscellaneous...................................... $ 1,500
-------
Total.............................................. $18,189
Item 15. Indemnification of Directors and Officers
Subchapter D of Chapter 17 of the Pennsylvania Business Corporation Law
("PBCL") provides in general that a corporation may indemnify any person,
including its directors, officers and employees, who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
proceeding, whether civil, criminal, administrative or investigative (including
actions by or in the right of the corporation) by reason of the fact that he or
she is or was a representative of or serving at the request of the corporation,
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him or her in connection with
the action or proceeding if he or she is determined by the board or directors,
or in certain circumstances by independent legal counsel or the shareholders, to
have acted in good faith and in a manner he or she reasonably believed to be in,
or not opposed to, the best interests of the corporation and, with respect to
any criminal proceeding, had no reason believe his or her conduct was unlawful.
In the case of actions by or in the right of the corporation, indemnification is
not permitted in respect of any claim, issue or matter as to which the person
has been adjudged to be liable to the corporation except to the extent a court
determines that the person is fairly and reasonably entitled to indemnification.
In any case, to the extent that the person has been successful on the merits or
otherwise in defense of any claim, issue or matter, he or she shall be
indemnified against expenses (including attorneys' fees) actually and reasonably
incurred by him or her in connection therewith. Subchapter D of Chapter 17 also
provides that the indemnification permitted or required thereby is not exclusive
of any other rights to which a person seeking indemnification may be entitled.
Article 10 of the Company's Articles of Incorporation provides that the
Company shall indemnify and hold harmless to the full extent not prohibited by
law, as the same exists or may be amended, interpreted or implemented (but, in
the case of any amendment, only to the extent that such amendment permits the
Company to provide broader indemnification rights than the Company is permitted
to provide prior to such amendment), each person who was or is made a party or
is threatened to be made a party to or is otherwise involved in (as witness or
otherwise) any threatened, pending or completed action, suit, or proceeding,
whether civil, criminal, administrative or investigative and whether or not by
or in the right of the Company or otherwise (hereinafter, a "proceeding"), by
reason of the fact that he or she, or a person of whom he or she is the heir,
executor or administrator, is or was a director or executive officer of the
Company or is or was serving at the request of the Company as a director,
officer or trustee of another corporation or of a partnership, joint venture,
trust or other enterprise (including without limitation service with respect to
employee benefit plans), or where the basis of such proceeding is any alleged
action or failure to take any action by such person while acting in an official
capacity as a director or executive officer of the Company, or in any other
capacity on behalf of the Company while such person is or was serving as a
director or executive officer of the Company, against all expenses, liability
and loss, including but not limited to attorney's fees, judgments, fines, excise
taxes or penalties and amounts paid or to be paid in settlement (whether with or
without court approval), actually and reasonably incurred or paid by such person
in connection therewith. The right to indemnification is a contract right and
includes the right to be paid by the Company the expenses incurred in defending
any such proceeding (or part thereof) or in enforcing his or her rights to
indemnification in
II-1
<PAGE>
advance of the final disposition thereof promptly after receipt by the Company
of a request therefor stating in reasonable detail the expenses incurred;
provided, however, that to the extent required by law, the payment of such
expenses incurred by a director or executive officer of the Company in advance
of the final disposition of a proceeding shall be made only upon receipt of an
undertaking, by or on behalf of such person, to repay all amounts so advanced if
and to the extent it shall ultimately be determined by a court that he or she is
not entitled to be indemnified by the Company.
The Company has entered into employment agreements with Sunil Wadhwani and
Ashok Trivedi, Co-Chairman and Chief Executive Officer and Co-Chairman and
President, respectively, which entitle them to be indemnified in their
capacities as directors, officers and controlling shareholders of the Company to
the full extent not prohibited by law. The Company also has entered into a
Shareholders Agreement with Messrs. Wadhwani and Trivedi pursuant to which the
Company agrees to indemnify them against certain liabilities, including
liabilities under the securities laws, that they may incur in connection with
any offering effected pursuant to their registration rights under the
Shareholders Agreement.
The Articles of the Company also provide pursuant to Section 1713 of the
PBCL that a director of Mastech shall not be personally liable for monetary
damages as such for any action taken, or any failure to take any action, unless:
(1) the director has breached or failed to perform the duties of his/her office
under Section 1712 of the PBCL (relating to standard of conduct and justifiable
reliance); and (2) the breach or failure to perform constitutes self-dealing,
willful misconduct or recklessness. This limitation on the personal liability of
directors of Company does not apply to: (1) the responsibility or liability of a
director pursuant to any criminal statute; or (2) the liability of a director
for the payment of taxes pursuant to local, state or Federal law.
The Company has purchased insurance insuring its directors and officers
against certain liabilities which they might incur as directors or officers of
the Company or of any other organization which they serve at its request,
including certain liabilities under the Securities Act.
Item 16. Exhibits
The following is a complete list of Exhibits filed as part of this
Registration Statement.
<TABLE>
<CAPTION>
Exhibit No. Reference Page
- ----------- ----------------- ------------
<S> <C> <C> <C>
5.01 Form of Opinion of Buchanan Ingersoll Professional Corporation. Previously Filed
23.01 Form of Consent of Arthur Andersen LLP. Filed herewith E-1
23.02 Form of Acknowledgment of Arthur Andersen LLP. Filed herewith E-2
23.03 Consent of Buchanan Ingersoll Professional Corporation (included in its
opinion).
24.01 Power of Attorney. Previously Filed
</TABLE>
Item 17. Undertakings
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
II-2
<PAGE>
(ii) To reflect in the prospectus any facts or events which,
individually or together, represent a fundamental change
in the information in the Registration Statement (or the
most recent post-effective amendment thereof); and
(iii) To include in such prospectus any additional or changed
material information on the plan of distribution
contained in this Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To file a post-effective amendment to remove from
registration any of the securities being registered which
remain unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers, and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission,
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer, or controlling person of the Registrant
in the success defense of any action, suit, or proceeding) is asserted by such
director, officer, or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all
requirements for filing on Form S-3 and has duly caused Amendment No. 1 to this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Pittsburgh, Commonwealth of Pennsylvania, on
March 8, 1999.
MASTECH CORPORATION
By: /s/ Sunil Wadhwani
------------------------
Sunil Wadhwani
Co-Chairman and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Amendment No. 1 to the Registration Statement has been signed by the following
persons in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- ----------------------------- ------------------------------ ------------
<S> <C> <C>
Principal Executive Officer:
/s/ Sunil Wadhwani Co-Chairman, Chief Executive March 8, 1999
------------------ Officer and Director
Sunil Wadhwani
Principal Financial Officer:
* Vice President - Finance March 8, 1999
---------------------- (principal financial officer)
Jeffrey McCandless
Principal Accounting Officer:
* Corporate Controller March 8, 1999
----------------- (principal accounting officer)
Neil M. Ebner
* Co-Chairman, President and March 8, 1999
----------------- Director
Ashok Trivedi
Director March , 1999
----------------- --
Ed Yourdon
* Director March 8, 1999
--------------------
J. Gordon Garrett
* Director March 8, 1999
-----------------
Michel Berty
*/s/ Sunil Wadhwani March 8, 1999
- ---------------------------------
Sunil Wadhwani, attorney-in-fact
</TABLE>
II-4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Reference Page
- ----------- ---------- ----
<S> <C> <C> <C>
5.01 Form of Opinion of Buchanan Ingersoll Professional Corporation Previously Filed
23.01 Form of Consent of Arthur Andersen LLP Filed herewith E-1
23.02 Form of Acknowledgment of Arthur Andersen LLP Filed herewith E-2
23.03 Consent of Buchanan Ingersoll Professional Corporation (included in
its opinion in Exhibit 5.01)
24.01 Power of Attorney Previously Filed
</TABLE>
<PAGE>
Exhibit 23.01
FORM OF
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our reports dated February 4, 1998,
included in Mastech Corporation's Form 10-K for the year ended December 31,
1997, and all references to our Firm included in this registration statement.
ARTHUR ANDERSEN LLP
Pittsburgh, Pennsylvania /s/ ARTHUR ANDERSEN LLP
March 4, 1999
E-1
<PAGE>
Exhibit 23.02
FORM OF ACKNOWLEDGEMENT
OF ARTHUR ANDERSEN LLP
March 4, 1999
Mastech Corporation
1004 McKee Road
Oakdale, PA 15071
Dear Sir:
We are aware that Mastech Corporation has incorporated by reference in this
Registration Statement its Form 10-Q for the quarterly periods ending March 31,
1998, June 30, 1998 and September 30, 1998 which includes our reports dated
April 24, 1998, July 24, 1998, and October 22, 1998, respectively, covering
the unaudited interim financial information contained therein. Pursuant to
Regulation C of the Securities Act of 1933, those reports are not considered a
part of the registration statement prepared or certified by our firm or a report
prepared or certified by our firm within the meaning of Section 7 and 11 of the
Act.
Very truly yours,
ARTHUR ANDERSEN LLP
/s/ ARTHUR ANDERSEN LLP
E-2
