As filed with the Securities and Exchange Commission on May 5, 2000
Registration No. 333-______
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
PRT GROUP INC.
(Exact name of Registrant as specified in its charter)
Delaware 7331 13-3914972
(State or other jurisdiction (Primary Standard (I.R.S. Employer
of incorporation Industrial Classification Identification Number)
or organization) Code Number)
80 Lamberton Road
Windsor, Connecticut 06095
(860) 687-2200
(Address, including zip code, and telephone number, including area
code, of Registrant's principal executive offices)
Richard Rosenfeld, Esq.
Secretary and General Counsel
PRT Group Inc.
80 Lamberton Road
Windsor, Connecticut 06095
(860) 687-2200
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copy to:
Mark N. Kaplan, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, New York 10036-6522
(212) 735-3000
Approximate date of commencement of proposed sale to the public:
As soon as practicable after the effective date of this Registration
Statement.
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, 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 this form is a post-effective amendment filed pursuant to Rule
462(d) 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. | |
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
=====================================================================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF SHARES AMOUNT TO BE AGGREGATE PRICE AGGREGATE REGISTRATION
TO BE REGISTERED REGISTERED(2) PER UNIT(3) OFFERING PRICE(3) FEE
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $0.001
per share(1) 12,151,778 shares $1.3125 $15,949,209.00 $4211
=====================================================================================================================
(1) 4,151,778 shares issuable upon exercise of warrants to purchase common
stock expiring on April 14, 2005 and 8,000,000 shares issuable upon
conversion of Series A Senior Participating Convertible Preferred Stock.
(2) In accordance with Rule 416 under the Securities Act of 1933, common
stock registered hereby also includes such indeterminate number of shares
as may be distributable from time to time pursuant to anti-dilution
provisions.
(3) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457, based on the closing price for the Company's common
stock Nasdaq National Market on May 3, 2000 of $1.3125 per share.
</TABLE>
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 Securities and
Exchange Commission, acting pursuant to said Section 8(a), may determine.
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE
MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH
THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT
AN OFFER TO SELL SECURITIES, AND WE ARE NOT SOLICITING OFFERS TO BUY THESE
SECURITIES, IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION, DATED MAY 5, 2000
[LOGO] PRT GROUP INC.
12,151,77 SHARES
COMMON STOCK
This prospectus relates to the public offering of 12,151,778
shares of our common stock, 8,000,000 of which are issuable upon conversion
of an equal number of presently outstanding shares of our Series A Senior
Participating Convertible Preferred Stock and 4,151,778 of which are
issuable upon exercise of presently outstanding warrants, in each case
subject to adjustment under certain circumstances.
The prices at which such stockholders may sell the shares will be
determined by the prevailing market price for the shares or in negotiated
transactions. PRT Group Inc. will not receive any of the proceeds from the
sale of shares by the selling stockholders.
PRT Group Inc.'s common stock is traded in the Nasdaq National
Market under the symbol "PRTG." The last reported sale price of the common
stock on the Nasdaq National Market on May 3, 2000 was $1.3125 per share.
THE SECURITIES AND EXCHANGE COMMISSION AND STATE SECURITIES
REGULATORS HAVE NOT APPROVED OR DISAPPROVED THESE SECURITIES OR DETERMINED
IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is May 5, 2000.
WE HAVE NOT AUTHORIZED ANY PERSON TO MAKE A STATEMENT THAT DIFFERS
FROM WHAT IS IN THIS PROSPECTUS. IF ANY PERSON DOES MAKE A STATEMENT THAT
DIFFERS FROM WHAT IS IN THIS PROSPECTUS, YOU SHOULD NOT RELY ON IT. THIS
PROSPECTUS IS NOT AN OFFER TO SELL, NOR IS IT SEEKING AN OFFER TO BUY,
THESE SECURITIES IN ANY STATE IN WHICH THE OFFER OR SALE IS NOT PERMITTED.
THE INFORMATION IN THIS PROSPECTUS IS COMPLETE AND ACCURATE AS OF ITS DATE,
BUT THE INFORMATION MAY CHANGE AFTER THE DATE.
TABLE OF CONTENTS
PAGE
INFORMATION REGARDING FORWARD-LOOKING STATEMENTS........................1
USE OF PROCEEDS.........................................................2
DILUTION................................................................2
PLAN OF DISTRIBUTION....................................................2
SELLING STOCKHOLDERS....................................................4
WHERE YOU CAN FIND MORE INFORMATION.....................................4
INCORPORATION BY REFERENCE..............................................5
LEGAL MATTERS...........................................................5
EXPERTS.................................................................5
INFORMATION REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains certain forward-looking statements that
involve substantial risks and uncertainties. When used in this section and
elsewhere in this prospectus, the words "anticipate," "believe," "expect,"
and similar expressions as they relate to us or our management are intended
to identify those forward-looking statements. Our actual results,
performance or achievements could differ materially from the results
expressed in, or implied by, those forward-looking statements. Factors that
could cause or contribute to differences include, without limitation, those
discussed in "Management's Discussion and Analysis of Financial Condition
and Results of Operations" in our Form 10-K Annual Report for the year
ended December 31, 1999, incorporated by reference in this prospectus.
SUMMARY
General. PRT Group Inc. was incorporated under the laws of the state of
Delaware in 1996. We were first incorporated as PRT Corp. of America, a New
York corporation, in 1989. We maintain our principal executive offices at
80 Lamberton Road, Windsor, Conn. 06095. Our telephone number is (860)
687-2200.
We are an information technology, or IT, solutions integrator. We
create complete, flexible IT solutions that meet or exceed our clients'
evolving business needs. From IT architecture and design through
implementation and ongoing support, we focus on long-term customer
relationships and evolutionary IT services. We have more than 360 employees
and 70 subcontractors in Solution Centers in Windsor, Connecticut, and
Barbados, West Indies; and in client-site operations throughout the
Northeastern and Mid-Atlantic United States.
We introduced two new strategic lines of business in 1999. The new
lines of business capitalize on the capabilities and competencies of our
team. The first -- eBusiness eNablement -- helps established companies and
commerce-oriented dot-com companies enter the Net economy at Internet
speed, prepared to execute large-scale transactions. The second -- IT
Solutions Outsourcing -- enables clients to turn over to us management of
an IT project, function or department -- improving efficiency and
maximizing results. These two lines of business, in combination with IT
Staffing, form our service portfolio.
Our solution centers in Windsor, Connecticut, and Barbados, West
Indies, provide centralized and comprehensive IT services that combine
skilled IT professionals, proven quality processes and knowledge management
systems. The centers, each more than 50,000 square feet in size, have
parallel technology infrastructures, organizational units and human
resource practices that enable us to shift projects and personnel to meet
client requirements and maximize staff productivity.
Our Balanced Quality System(TM) meets industry standards while
reflecting the realities of the client's business priorities. The system is
a dynamic approach that draws on four sources for setting and meeting
quality goals for each solution component: rigorous quality principles
based on the Software Engineering Institute's Capability Maturity Model;
iRAD, our own interactive rapid application development process; project
management; and the business value of the function as stated by the client.
To provide quality measurement and control, we keep our quality
assurance teams independent from project management teams. We also maintain
a proprietary, Lotus Notes-based Knowledge Asset Database(TM) with
best-practice methods, tool sets and work products that are available to
all project teams.
IT Staffing. This business line accounted for roughly 62% of our revenues
in the year ended December 31, 1999. Our IT Staffing service delivers
individual or team staffing for a full spectrum of IT application
development and maintenance services, from legacy systems and client server
to Internet and network solutions. We offer specific industry expertise in
the insurance, finance, pharmaceutical and high-tech sectors.
We built our reputation on the capabilities of our experienced
project managers, skilled in the use of our Balanced Quality System and
Knowledge Asset Database(TM). Other frequently filled positions include
business analysts, architectural designers, application and tools
programmers, database designers and programmers, usability engineers,
testers, technical writers and help desk support.
Our professionals have a wide range of skills, including
state-of-the-art Internet languages and protocols, operating systems,
technologies, databases, applications, tools and security, as well as
legacy skills. To keep skills sharp, we provide computer-based and
classroom training for employees and subcontractors.
eBusiness eNablement. Introduced in August 1999, this business line
accounted for 9% of our revenues in the year ended December 31, 1999.
Through eBusiness eNablement, we ensure the rapid development of focused,
flexible solutions that meet or exceed our clients' business goals. Our
solutions allow for easy implementation of new applications, integration
with existing platforms, and communication and interaction with the
client's supply chain and customers.
We begin each e-business project with WebStarter(TM).
WebStarter(TM) explores the client's current situation and e-business goals
and creates a clear picture of the scope of the project, how work will
proceed and how much the solution will cost -- both to develop and operate.
WebStarter(TM) results include: concept design, the proposed architectural
model, a high-level use case model, an iteration schedule, a quality
overview, high-risk sequence diagrams, a risk assessment, a detailed
project plan as well as a budget. After WebStarter(TM) is complete, a
project team and client move into iRAD -- our iterative process for rapid
application development. The project team focuses on the most complex,
high-risk functional components of the solution first. Team members
construct, implement and test the first set of components. As they add
components, they revisit each previous set to ensure compatibility and
functionality. The overall development process includes three phases: (1)
Elaborate -- define, design, (2) Build -- model and build, and (3) Deliver
- -- improve, test, deploy and document.
Our iRAD process gives clients several major benefits, including
clear, accurate information up-front about schedules and costs. It also
provides clients with early validation and less risk because the most
complex components are built first. Clients also benefit from flexible,
scalable solutions which are built to industry standards.
After development is complete, we offer technical operations
support to manage and maintain the solution.
IT Solutions Outsourcing. Launched in August 1999, this business line
accounted for roughly 29% of our revenues in the year ended December 31,
1999. IT Solutions Outsourcing gives clients access to expert technical
support without the expense and administrative burden of maintaining
facilities, technology or adding full-time personnel. IT Solutions
Outsourcing services include application development and maintenance,
networking, call centers and help desks, systems management and Internet
communications. We can manage an outsourced project in the customer's
facility or in one of our Solution Centers. Our IT Solutions Outsourcing
Services encompass: (1) Resources -- the acquisition, deployment, and uses
of people, facilities, technology, equipment, support functions and
supplies, (2) Integration -- the linking of business processes, including
the development of interfaces, with related processes and applications, and
(3) Performance -- shared commitments for setting, measuring and achieving
optimal service.
USE OF PROCEEDS
All of the shares of our common stock being sold by means of this
prospectus are being sold by the selling stockholders. We will not receive
any proceeds from the sale of the shares of our common stock.
DILUTION
None of the shares offered hereby are being sold by us. Therefore,
there will be no dilution in the net tangible book value per share as a
result of the sale of the shares offered hereby.
PLAN OF DISTRIBUTION
On April 17, 2000, we issued 8,000,000 shares of our Series A
Senior Participating Convertible Preferred Stock, referred to in this
prospectus as the preferred stock, for $8,000,000. We also issued warrants
to the preferred stock investors to purchase 4,000,000 shares of our common
stock at an initial exercise price of $1.00 per share subject to
adjustment, as defined. We issued to our financial advisor in that
transaction warrants to purchase an additional 151,778 shares of our common
stock at an initial exercise price of $1.20 per share subject to
adjustment, as defined. The preferred stock is convertible, subject to
adjustment, as defined, into common stock on a one for one basis at any
time and is redeemable after April 14, 2005 at the option of the holder at
its liquidation value plus accrued and unpaid dividends. Each warrant is
exercisable for one share of common stock prior to April 14, 2005 at the
option of the holder.
The purchase agreement pursuant to which we sold the preferred
stock and the warrants contained a registration rights provision, requiring
us to file a shelf registration statement on Form S-3 to register sales of
the shares of common stock issuable upon conversion of the preferred stock
and exercise of the warrants.
We are registering all of the shares being registered pursuant to
the registration statement of which this prospectus forms a part on behalf
of the holders of the preferred stock and the warrants. We will receive no
proceeds from this offering. The selling stockholders named in the table
below or pledgees, donees, transferees or other successors-in-interest
selling shares received from a named selling stockholder as a gift,
partnership distribution or other non-sale related transfer after the date
of this prospectus (collectively, the "selling stockholders") may sell the
shares from time to time. The selling stockholders will act independently
of us in making decisions with respect to the timing, manner and size of
each sale. The sales may be made on one or more exchanges or in the
over-the-counter market or otherwise, at prices and at terms then
prevailing or at prices related to the then current market price, or in
negotiated transactions. The selling stockholders may effect these
transactions by selling the shares to or through broker-dealers. The shares
may be sold by one or more of, or a combination of, the following:
o an underwritten offering;
o a block trade in which the broker-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;
o purchases by a broker-dealer as principal and resale by such
broker-dealer for its account pursuant to this prospectus;
o an exchange distribution in accordance with the rules of such
exchange;
o ordinary brokerage transactions and transactions in which the
broker solicits purchasers; and
o in privately negotiated transactions.
To the extent required, this prospectus may be amended or
supplemented from time to time to describe a specific plan of distribution.
In effecting sales, broker-dealers engaged by the selling stockholders may
arrange for other broker-dealers to participate in the resales.
The selling stockholders may enter into hedging transactions with
broker-dealers in connection with distributions of the shares or otherwise.
In such transactions, broker-dealers may engage in short sales of the
shares in the course of hedging the positions they assume with selling
stockholders. The selling stockholders also may sell shares short and
redeliver the shares to close out such short positions. The selling
stockholders may enter into options or other transactions with
broker-dealers which require the delivery to the broker-dealer of the
shares. The broker-dealer may then resell or otherwise transfer those
shares pursuant to this prospectus. The selling stockholders also may loan
or pledge the shares to a broker-dealer. The broker-dealer may sell the
shares so loaned, or upon a default the broker-dealer may sell the pledged
shares pursuant to this prospectus.
Broker-dealers or agents may receive compensation in the form of
commissions, discounts or concessions from selling stockholders.
Broker-dealers or agents may also receive compensation from the purchasers
of the shares for whom they act as agents or to whom they sell as
principals, or both. Compensation as to a particular broker-dealer might be
in excess of customary commissions and will be in amounts to be negotiated
in connection with the sale. Broker-dealers or agents and any other
participating broker-dealers or the selling stockholders may be deemed to
be 'underwriters' within the meaning of Section 2(11) of the Securities Act
in connection with the sales of the shares. Accordingly, any such
commission, discount or concession received by them and any profit on the
resale of the shares purchased by them may be deemed to be underwriting
discounts or commissions under the Securities Act. Because selling
stockholders may be deemed to be 'underwriters' within the meaning of
Section 2(11) of the Securities Act, the selling stockholders will be
subject to the prospectus delivery requirements of the Securities Act. In
addition, any securities covered by this prospectus which qualify for sale
pursuant to Rule 144 promulgated under the Securities Act may be sold under
Rule 144 rather than pursuant to this prospectus. The selling stockholders
have advised us that they have not entered into any agreements,
understandings or arrangements with any underwriters or broker-dealers
regarding the sale of their securities. There is presently no underwriter
or coordinating broker acting in connection with the proposed sale of
shares by selling stockholders, although the selling stockholders may
engage an underwriter for the sale and distribution of shares in the
future.
The shares will be sold only through registered or licensed
brokers or dealers if required under applicable state securities laws. In
addition, in certain sates the shares may not be sold unless they have been
registered or qualified for sale in the applicable state or an exemption
from the registration or qualification requirement is available and is
complied with.
Under applicable rules and regulations under the Exchange Act, any
person engaged in the distribution of the shares may not simultaneously
engage in market-making activities with respect to our common stock for a
period of two business days prior to the commencement of such distribution.
In addition, each selling stockholder will be subject to applicable
provisions of the Exchange Act and the associated rules and regulations
under the Exchange Act, including Regulation M, which provisions may limit
the timing of purchases and sales of shares of our common stock by the
selling stockholders. We will make copies of this prospectus available to
the selling stockholders and have informed them of the need for delivery of
copies of this prospectus to purchasers at or prior to the time of any sale
of the shares.
We will file a supplement to this prospectus, if required,
pursuant to Rule 424(b) under the Securities Act upon being notified by a
selling stockholder that any material arrangement has been entered into
with a broker-dealer for the sale of shares through a block trade, special
offering, exchange distribution or secondary distribution or a purchase by
a broker or dealer. That supplement will disclose:
o the name of each such selling stockholder and of the
participating broker-dealer(s) or underwriter if any;
o the number of shares involved;
o the price at which such shares were sold;
o the commissions paid or discounts or concessions allowed to
such broker-dealer(s), where applicable;
o that such broker-dealer(s) or underwriter if any did not
conduct any investigation to verify the information set out
or incorporated by reference in this prospectus; and
o other facts material to the transaction.
We will bear all costs, expenses and fees in connection with the
registration of the shares. The selling stockholders will bear all
commissions and discounts, if any, attributable to the sales of the shares.
SELLING STOCKHOLDERS
<TABLE>
<CAPTION>
NUMBER OF SHARES NUMBER OF SHARES
BENEFICIALLY REGISTERED FOR
NAME OWNED (1) SALE HEREBY (2)
- -----------------------------------------------------------------------------------------------
<S> <C> <C>
The Travelers Indemnity Company 632,450 5,625,000
Tudor-BVI Global Portfolio Ltd. 394,750 2,914,154
Tudor Arbitrage Partners LP 121,590 895,101
The Raptor Global Portfolio Ltd. 245,960 1,815,745
EFG Eurofinancial Investment Company 0 750,000
Carter Capital Corporation 0 151,778
(1) Excludes the shares issuable upon conversion of Series A Senior
Participating Convertible Preferred Stock and exercise of warrants
being registered for sale pursuant to the registration statement
of which this prospectus forms a part.
(2) We are registering for sale only those shares issuable upon
conversion of Series A Senior Participating Convertible Preferred
Stock and exercise of warrants referred to in (1) above.
</TABLE>
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the informational requirements of the Exchange Act, and,
consequently, are required to file periodic reports and other information
with the SEC. Such information can be inspected without charge at the
public reference facilities of the SEC at Room 1024, Judiciary Plaza, 450
Fifth Street, N.W., Washington, D.C. 20549 and at the regional offices of
the SEC located at Suite 1400, Northwest, Atrium Center, 500 West Madison
Street, Chicago, Illinois 60661 and Seven World Trade Center, 13th Floor,
New York, New York 10048. Copies of such material may also be obtained at
prescribed rates from the Public Reference Section of the SEC, 450 Fifth
Street, N.W., Washington, D.C. 20549. The SEC also maintains a web site
(http://www.sec.gov) that contains all information we file electronically
with the SEC.
INCORPORATION BY REFERENCE
This prospectus is part of a registration statement (Registration
No. 333- ) we filed with the SEC. The SEC permits us to incorporate by
reference: the information that 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 information that we file with the SEC after the date of
this prospectus will automatically update and supersede this information.
We incorporate by reference the documents listed below filed by us with the
SEC. We also incorporate by reference any future filings made with the SEC
under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of
1934, as amended, after the date of this prospectus until the termination
of this offering.
o Our Annual Report on Form 10-K for the fiscal year ended
December 31, 1999.
o The description of our common stock contained in the
Registration Statement on Form 8-A filed by us to register
our common stock pursuant to Section 12(g) of the Securities
Exchange Act of 1934, as amended, including any amendments or
reports filed for the purposes of updating that description.
If you request a copy of any or all of the documents incorporated
by reference, we will send to you the copies requested at no charge.
However, we will not send exhibits to such documents unless such exhibits
are specifically incorporated by reference in such documents. You should
direct requests for such copies to: Richard Rosenfeld, Esq., General
Counsel, PRT Group Inc., 7 Skyline Drive, Hawthorne, NY 10532.
LEGAL MATTERS
The validity of the securities offered under this registration
statement will be passed upon for us by our Secretary and General Counsel,
Richard Rosenfeld, Esq.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our
consolidated financial statements and schedules included in our Annual
Report on form 10-K for the year ended December 31, 1999 as set forth in
their report, which is incorporated by reference in this prospectus and
elsewhere in the registration statement. Our financial statements and
schedules are incorporated by reference in reliance on Ernst & Young LLP's
report, given on their authority as experts in accounting and auditing.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The expenses of the offering are estimated to be as follows:
Securities and Exchange Commission Registration Fee........$4211
Legal fees and expenses..................................$15,000
Accounting fees and expenses..............................$3,000
Miscellaneous...............................................$289
-------
TOTAL....................................................$22,500
========
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS
PRT Group Inc., or PRT, is incorporated under the laws of the
State of Delaware. Section 145 of the General Corporation Law of the State
of Delaware (the "DGCL") provides that a Delaware corporation may indemnify
any person who was or is a party, or is threatened to he made, a party to
any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (other than an action by
or in the right of such corporation) by reason of the fact that such person
is or was a director, officer, employee or agent of the corporation, or is
or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust
or other enterprise. The indemnity may include expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually
and reasonably incurred by such person in connection with such action, suit
or proceeding provided such person acted in good faith and in a manner such
person reasonably believed to be in or not opposed to the best interests of
the corporation, and, with respect to any criminal action or proceeding,
had no reasonable cause to believe his or her conduct was unlawful. A
Delaware corporation may also indemnify any person who is or was a party,
or is threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of the corporation to procure a judgment
in its favor by reason of the fact that such person is or was a director,
officer, employee or agent of such corporation, or is or was serving at the
request of such corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise.
The indemnity may include expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection with the defense or
settlement of such action or suit, provided such person acted in good faith
and in a manner the person reasonably believed to be in or not opposed to
the corporation's best interests, except that no indemnification is
permitted without judicial approval if the officer, director, employee or
agent is adjudged to be liable to the corporation. In addition, Section
145(c) of the DGCL provides that when an officer or director is successful
on the merits or otherwise in the defense of any action referred to above,
the corporation must indemnify such person against the expenses (including
attorneys' fees) which such officer or director has actually and reasonably
incurred.
PRT Amended and Restated Certificate of Incorporation and By-Laws
contain provisions requiring indemnification of its officers and directors
to the fullest extent authorized or permitted by law, provided, however,
that, except for proceedings to enforce rights to indemnification, PRT is
not obligated to indemnify any director or officer in connection with a
proceeding (or part thereof) initiated by such person unless such
proceeding (or part thereof) was authorized or consented to by PRT Board of
Directors.
Section 145(e) of the DGCL provides that expenses (including
attorneys' fees) incurred by an officer or director in defending any civil,
criminal, administrative or investigative action, suit or proceeding may be
paid by the corporation in advance of the final disposition of such action,
suit or proceeding upon receipt of an undertaking by or on behalf of such
director or officer to repay such amount if it shall ultimately be
determined that such director or officer is not entitled to be indemnified
by the corporation. PRT Amended and Restated Certificate of Incorporation
and By-Laws contain provisions mandating such payment.
The indemnification and advancement of expenses provided by, or
granted pursuant to, Section 145 of the DGCL, PRT Amended and Restated
Certificate of Incorporation and PRT By-Laws are not deemed to be exclusive
of any other rights to which those seeking indemnification or advancement
of expenses may be entitled under any bylaw, agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in
such person's official capacity and as to action in another capacity while
holding such office. In addition, Section 145 of the DGCL authorizes a
corporation to purchase and maintain insurance on behalf of any person who
is or was a director, officer, employee or agent of the corporation or is
or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust
or other enterprise against any liability asserted against such person and
incurred by such person in any such capacity, or arising out of such
person's status as such, whether or not the corporation would have the
power to indemnify such person against such liability under Section 145 of
the DGCL. PRT By-Laws contain a similar authorization. PRT maintains an
insurance policy under which directors and officers are insured, within the
limits and subject to the limitation of such insurance policy, against
certain liabilities which may be imposed in connection with such persons'
service as such directors or officers.
Section 102(b) (7) of the DGCL permits a corporation to provide in
its certificate of incorporation that a director of the corporation shall
not be personally liable to the corporation or its stockholders for
monetary damages for breach of fiduciary duties as a director, except for
liability (i) for any breach of a director's duty of loyalty to the
corporation or its stockholders, (ii) for acts or omissions not in good
faith or that involve intentional misconduct or a knowing violation of the
law, (iii) for improper payment of dividends, stock purchases or
redemptions of shares or (iv) for any transaction from which the director
derives an improper personal benefit. PRT Amended and Restated Certificate
of Incorporation provides that no director of PRT shall be personally
liable to PRT or any of its stockholders for breach of a fiduciary duty as
a director, except to the extent that such exemption from liability is not
permitted under the DGCL.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES
Set forth below is information with respect to the securities of
PRT issued or sold by PRT within the last three years that were not
registered under the Securities Act of 1933, as amended (the "Securities
Act") and issued under the exemption from registration provided by Section
4(2) of the Securities Act. Except as set forth below, all sales were to
sophisticated accredited investors. Except as set forth below, no
underwriters were involved in any of the sales and no underwriting
discounts or commissions were accrued or paid.
8,000,000 shares of our Series A Senior Participating Convertible Preferred
Stock and 4,000,000 warrants to purchase our common stock sold to two of
our existing shareholders on April 17, 2000 for aggregate proceeds of
$8,000,000, to be used as general working capital. We issued an additional
151,778 warrants to out financial advisor in the above transaction.
ITEM 16. EXHIBITS
EXHIBIT NUMBER DESCRIPTION
5 Opinion of Richard Rosenfeld, Esq., Secretary and General
Counsel of the Registrant.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of Richard Rosenfeld, Esq., Secretary and General
Counsel of the Registrant (contained in Exhibit 5 hereto).
24.1 Powers of Attorney (included in signature page).
ITEM 17. UNDERTAKINGS
We hereby undertake:
(1)(a) To file, during any period in which offers or sales are
being make, 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) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20 percent change in the maximum aggregate
offering price set forth in the 'Calculation of Registration Fee' table in
the effective registration statement.
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in the registration
statement or any material change to such information in the registration
statement; provided, however, that paragraphs (a) (1) (i) and (a) (1) (ii)
do not apply if the registration statement is on Form S-3, Form S-8 or Form
F-3, and the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed with
or furnished to the Commission by the registrant pursuant to Section 13 or
15 (d) of the Securities Exchange Act of 1934 that are incorporated by
reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, 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 remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to directors, officers or
persons controlling us pursuant to the provisions described in Item 15
above, or otherwise, we have been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act of 1933, as amended, and is,
therefore, unenforceable. If a claim for indemnification against such
liabilities (other than payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of us in the successful
defense of any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities being
registered, we will, unless in the opinion of our counsel the matter has
been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by us is against
public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
(c) We hereby undertake that:
(1) For purposes of determining any liability under the Securities
Act of 1933, the information omitted from the form of prospectus filed as
part of this registration statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the registrant pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be
part of this registration statement as of the time it was declared
effective.
(2) For the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a form
of prospectus 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.
(d) We hereby undertake 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 (and, where applicable, each filing of
an employee benefit plan's annual report pursuant to 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.
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant
certifies that it has reasonable grounds to believe that it meets all of
the requirements for filing on Form S-3 and has duly caused this
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Windsor, State of Connecticut, on
this 5th day of May, 2000.
PRT Group Inc.
By /s/ Dan S. Woodward
-------------------
Name: Dan S. Woodward
Title: Director, President and
Chief Executive Officer
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose
signature appears below constitutes and appoints Dan S. Woodward and
Richard Rosenfeld, Esq., or either of them, his true and lawful
attorney-in-fact and agent, with full power of substitution, for him and in
his name, place and stead, in any and all capacities, to sign any and all
amendments (including post-effective amendments) to this Registration
Statement and to file the same with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorney-in-fact and agent full power and
authority to do and perform each and every act and thing requisite and
ratifying and confirming all that said attorney-in-fact and agent or his
substitute or substitutes may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
Name Title Date
- ---- ----- ----
/s/ Dan S. Woodward Director, President and May 5, 2000
- ------------------- Chief Executive Officer
Dan S. Woodward
/s/ Rocco Mitarotonda Chief Financial Officer May 5, 2000
- ---------------------- (principal financial and
Rocco Mitarotonda accounting officer)
/s/ Esther Dyson Director May 5, 2000
- ----------------
Esther Dyson
/s/ Michael Enthoven Director May 5, 2000
- --------------------
Michael Enthoven
/s/ Craig D. Goldman Director May 5, 2000
- --------------------
Craig D. Goldman
/s/ Robert P. Forlenza Director May 5, 2000
- ----------------------
Robert P. Forlenza
/s/ Isaac Shapiro Director May 5, 2000
- -----------------
Isaac Shapiro
/s/ Irwin J. Sitkin Director May 5, 2000
- -------------------
Irwin J. Sitkin
/s/ Jack L. Rivkin Director May 5, 2000
- ------------------
Jack L. Rivkin
/s/ Ronald E. Weinberg Director May 5, 2000
- ----------------------
Ronald E. Weinberg
s/ Douglas K. Mellinger Director May 5, 2000
- -----------------------
Douglas K. Mellinger
EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION
5 Opinion of Richard Rosenfeld, Esq., Secretary and
General Counsel of the Registrant.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of Richard Rosenfeld, Esq., Secretary and
General Counsel of the Registrant (contained in
Exhibit 5 hereto).
24.1 Powers of Attorney (included in signature page).
EXHIBIT 5.1
May 5, 2000
PRT Group Inc.
80 Lamberton Road
Windsor, Connecticut 06095
Ladies and Gentlemen:
I am General Counsel and Secretary of PRT Group Inc., a
Delaware corporation (the "Company"), and have acted as counsel for the
Company in connection with its filing with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, of a Registration
Statement on Form S-3 (the "Registration Statement") with respect to the
Company's Common Stock, par value $.001 per share (the "Common Stock").
In preparation for rendering my opinion hereafter
expressed, I have examined the originals or copies certified to my
satisfaction of corporate records and other documents and certificates as I
have deemed necessary.
Based on the above, I am of the opinion that:
(3) The Company is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware.
(4) When sold, the Common Stock covered by the Registration Statement
will be legally issued by the Company, duly authorized, fully paid
and non-assessable.
I hereby consent to the use of this opinion letter as
Exhibit 5.1 to the Registration Statement and to the use of my name under
the caption "Legal Matters" in the prospectus included therein.
Very truly yours,
/s/ RICHARD ROSENFELD
---------------------------
RICHARD ROSENFELD, ESQ.
General Counsel and Secretary
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement on Form S-3 and the related Prospectus of PRT Group
Inc. for the registration of 12,151,778 shares of its common stock and to
the incorporation by reference therein of our report dated January 31,
2000, except for paragraph 1 of Note 16 and Note 17, as to which the date
is April 14, 2000, with respect to the consolidated financial statements
and schedule of PRT Group Inc included in its Annual Report (Form 10 K) for
the year ended December 31, 1999, filed with the Securities and Exchange
Commission.
/s/ Ernst & Young LLP
New York, New York
May 5, 2000
