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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 27, 1999.
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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WASTE CONNECTIONS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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DELAWARE 4953 94-3283464
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
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2260 DOUGLAS BOULEVARD, SUITE 280
ROSEVILLE, CALIFORNIA 95661
(916) 772-2221
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
RONALD J. MITTELSTAEDT
PRESIDENT, CHIEF EXECUTIVE OFFICER AND CHAIRMAN
WASTE CONNECTIONS, INC.
2260 DOUGLAS BOULEVARD, SUITE 280
ROSEVILLE, CALIFORNIA 95661
(916) 772-2221
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
COPIES OF ALL COMMUNICATIONS TO:
CAROLYN S. REISER, ESQ.
SHARTSIS, FRIESE & GINSBURG LLP
ONE MARITIME PLAZA, 18TH FLOOR
SAN FRANCISCO, CALIFORNIA 94111
(415) 421-6500
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration Statement.
If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) 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. [ ]
CALCULATION OF REGISTRATION FEE(2)
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PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO BE AGGREGATE OFFERING AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED PRICE(1) REGISTRATION FEE(2)
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Common Stock, $0.01 par value.............. 6,000,000 shares $149,625,000 $41,595.75
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(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) and based on the average high and low sales prices
of the Common Stock reported by the Nasdaq National Market on July 23, 1999.
(2) $28,470.28 previously paid: $13,125.47 paid with this filing.
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 BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
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SUBJECT TO COMPLETION, DATED JULY 27, 1999.
6,000,000 SHARES
[LOGO]
COMMON STOCK
We may offer and sell up to 6,000,000 shares of our common stock from time to
time as consideration for our acquisition of solid waste collection,
transportation, disposal and recycling businesses and assets. The prices of
these shares will be reasonably related to the common stock's market prices when
the parties agree to an acquisition or when we deliver the shares.
Our common stock is traded on the Nasdaq National Market under the symbol
"WCNX". On July 26, 1999, the last sale price of our common stock was $25.125
per share.
INVESTING IN THE COMMON STOCK INVOLVES RISK. SEE "RISK FACTORS" BEGINNING ON
PAGE 4.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR DETERMINED WHETHER
THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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The date of this prospectus is July , 1999.
The information in this prospectus is not complete and may be changed. These
securities may not be sold until the registration statement filed with the
Securities and Exchange Commission becomes effective. This prospectus is not an
offer to sell these securities, and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
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TABLE OF CONTENTS
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ABOUT THIS PROSPECTUS....................................... 3
THE COMPANY................................................. 3
RISK FACTORS................................................ 4
USE OF PROCEEDS............................................. 11
WHERE YOU CAN FIND MORE INFORMATION......................... 12
SELECTED FINANCIAL INFORMATION.............................. 13
SECURITIES COVERED BY THIS PROSPECTUS....................... 18
LEGAL MATTERS............................................... 19
EXPERTS..................................................... 19
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This prospectus incorporates important business and financial information about
Waste Connections that is not included in or delivered with this prospectus. You
may request copies of this information, at no cost, by writing or calling us at
the following address or telephone number:
Waste Connections, Inc.
2260 Douglas Blvd., Suite 280
Roseville, California 95661
Attention: Steven F. Bouck
Executive Vice President and
Chief Financial Officer
Telephone: (916) 772-2221
To assure timely delivery of the documents, you must request the information no
later than five business days prior to the date on which you must make your
investment decision.
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INFORMATION ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement on Form S-4 that we filed
with the SEC that will allow us to issue, from time to time, up to 6,000,000
shares of our common stock in connection with acquisitions of other businesses
or assets. You should read both this prospectus and the additional information
described under the heading "WHERE YOU CAN FIND MORE INFORMATION."
THE COMPANY
Waste Connections is a regional, integrated solid waste services company that
provides solid waste collection, transfer, disposal and recycling services in
secondary markets of the Western U.S. We currently own and operate 42 collection
operations, 13 transfer stations and six solid waste landfills and operate an
additional seven transfer stations, two solid waste landfills and 13 recycling
facilities. As of June 30, 1999, we served more than 390,000 commercial,
industrial and residential customers in 11 states: California, Idaho, Kansas,
Minnesota, Nebraska, Oklahoma, Oregon, South Dakota, Utah, Washington, and
Wyoming. Approximately 70% of our pro forma revenues for the three months ended
March 31, 1999, were derived from exclusive arrangements, including franchise
agreements, long-term municipal contracts and governmental certificates.
Waste Connections was formed in September 1997 to build a leading solid waste
services company in the secondary markets of the Western U.S. We have targeted
these markets because we believe that: (1) a large number of independent solid
waste services companies suitable for acquisition by us are located in these
markets; (2) there is less competition in these markets from large,
well-capitalized solid waste services companies; and (3) these markets have
strong projected economic and population growth rates. In addition, our senior
management team has extensive experience in acquiring, integrating and operating
solid waste services businesses in the Western U.S.
We have developed a two-pronged strategy tailored to the competitive and
regulatory factors that affect our markets. In the markets where waste
collection services are performed under exclusive arrangements, we generally
focus on controlling the solid waste stream by providing collection services
under such arrangements. In markets where we believe that competitive and
regulatory factors make owning landfills advantageous, we generally focus on
providing integrated services, from collection through disposal of solid waste
in landfills that we own or operate.
Acquisitions have been and will continue to be a principal component of our
growth strategy. From our inception in September 1997 to June 30, 1999, we
acquired 80 solid waste services businesses. Generating internal growth and
securing additional exclusive arrangements are also important components of our
growth strategy.
Waste Connections' executive offices are located at 2260 Douglas Boulevard,
Suite 280, Roseville, California 95661. Our telephone number is (916) 772-2221.
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RISK FACTORS
You should carefully consider the risks described below before making an
investment decision. The risks and uncertainties described below are not the
only ones facing our company. Additional risks and uncertainties not presently
known to us or that we currently deem immaterial may also impair our business
operations.
Any or all of the following risks could materially and adversely affect our
business, financial condition and results of operations. As a result, the
trading price of our common stock could decline, and you may lose all or part of
your investment.
This prospectus also contains forward-looking statements that involve risks and
uncertainties. Our actual results could differ materially from those anticipated
in the forward-looking statements as a result of the risks described below and
elsewhere in this prospectus and other factors that we cannot now foresee.
WE MAY HAVE DIFFICULTY EXECUTING OUR GROWTH STRATEGY
Our growth strategy includes expanding through acquisitions, acquiring
additional exclusive arrangements and generating internal growth. Whether we can
execute our growth strategy depends on several factors, including the success of
existing and emerging competition, the availability of acquisition candidates,
our ability to maintain profit margins in the face of competitive pressures, our
ability to continue to recruit, train and retain qualified employees, the
strength of demand for our services and the availability of capital to support
our growth.
RAPID GROWTH MAY STRAIN OUR MANAGEMENT, OPERATIONAL, FINANCIAL AND OTHER
RESOURCES
From inception through June 30, 1999, we acquired 80 solid waste services
related businesses. To maintain and manage our growth, we will need to expand
our management information systems capabilities and our operational and
financial systems and controls. We will also need to attract, train, motivate,
retain and manage additional senior managers, technical professionals and other
employees. Failure to do any of these things would materially and adversely
affect our business and financial results.
OUR GROWTH AND FUTURE FINANCIAL PERFORMANCE DEPEND SIGNIFICANTLY ON OUR ABILITY
TO INTEGRATE ACQUIRED BUSINESSES INTO OUR ORGANIZATION AND OPERATIONS
Part of our strategy is to achieve economies of scale and operating efficiencies
by growing through acquisitions. We may not achieve these goals unless we
effectively combine the operations of acquired businesses with our existing
operations. Our senior management team may not be able to integrate our
completed and future acquisitions. Any difficulties we encounter in the
integration process could materially and adversely affect our business and
financial results.
OUR GROWTH MAY BE LIMITED BY THE INABILITY TO MAKE ACQUISITIONS ON ATTRACTIVE
TERMS
Although we have identified numerous acquisition candidates that we believe are
suitable, we may not be able to acquire them at prices or on terms and
conditions favorable to us. As a result, our growth would be limited.
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WE COMPETE FOR ACQUISITION CANDIDATES WITH OTHER PURCHASERS, SOME OF WHICH HAVE
GREATER FINANCIAL RESOURCES THAN WASTE CONNECTIONS
Other companies have adopted or will probably adopt our strategy of acquiring
and consolidating regional and local businesses. We expect that increased
consolidation in the solid waste services industry will increase competitive
pressures. Increased competition for acquisition candidates may make fewer
acquisition opportunities available to us, and may cause us to make acquisitions
on less attractive terms, such as higher purchase prices. Acquisition costs may
increase to levels beyond our financial capability or to levels that would
adversely affect our operating results and financial condition. Our ongoing
ability to make acquisitions will depend in part on the relative attractiveness
of our common stock as consideration for potential acquisition candidates. This
attractiveness may depend largely on the relative market price and capital
appreciation prospects of our common stock compared to the stock of our
competitors. If the market price of our common stock were to decline materially
over a prolonged period of time, we may find it difficult to make acquisitions
on attractive terms.
TIMING AND STRUCTURE OF ACQUISITIONS MAY CAUSE FLUCTUATIONS IN OUR QUARTERLY
RESULTS
We are not always able to control the timing of our acquisitions. Obtaining
third party consents and regulatory approvals, completing due diligence on the
acquired businesses, and finalizing transaction terms and documents are not
entirely within our control and may take longer than we anticipate, causing
certain transactions to be delayed. Our inability to complete acquisitions in
the time frames that we expect may adversely affect our business, financial
condition and operating results. In addition, whether we account for an
acquisition using the purchase or the pooling-of-interests method determines how
the acquisition affects our financial results.
WE HAVE ONLY A LIMITED OPERATING HISTORY FROM WHICH YOU MAY EVALUATE OUR
BUSINESS AND PROSPECTS
Waste Connections was formed in September 1997 and commenced operations on
October 1, 1997. Accordingly, you should consider the disclosures about Waste
Connections in this prospectus in light of the risks, expenses and difficulties
that companies frequently encounter in their early stages of development. Our
senior management team may not be able to manage Waste Connections successfully
or to implement our operating and growth strategies.
WE MAY BE UNABLE TO COMPETE EFFECTIVELY WITH GOVERNMENTAL SERVICE PROVIDERS AND
LARGER AND BETTER CAPITALIZED COMPANIES
Our industry is highly competitive and fragmented and requires substantial labor
and capital resources. Some of the markets in which we compete or will likely
compete are served by one or more large, national solid waste companies, as well
as by numerous regional and local solid waste companies of varying sizes and
resources, some of which have accumulated substantial goodwill in their markets.
We also compete with counties, municipalities and solid waste districts that
maintain their own waste collection and disposal operations. These operators may
have financial advantages over Waste Connections because of their access to user
fees and similar charges, tax revenues and tax-
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exempt financing. Some of our competitors may also be better capitalized, have
greater name recognition or be able to provide services at a lower cost than
Waste Connections.
WE MAY LOSE CONTRACTS THROUGH COMPETITIVE BIDDING, EARLY TERMINATION OR
GOVERNMENTAL ACTION
We derive a substantial portion of our revenue from services provided under
exclusive municipal contracts, franchise agreements and governmental
certificates. Many of these will be subject to competitive bidding at some time
in the future. We also intend to bid on additional municipal contracts and
franchise agreements. However, we may not be the successful bidder. In addition,
some of our customers may terminate their contracts with us before the end of
the contract term. Municipalities in Washington may by law annex unincorporated
territory, which would remove such territory from the area covered by
governmental certificates issued to us by the Washington Utilities and
Transportation Commission (the "WUTC"). Annexation would reduce the areas
covered by our governmental certificates and subject more of our Washington
operations to competitive bidding in the future. Moreover, legislative action
could amend or repeal the laws governing governmental certificates, which could
materially and adversely affect Waste Connections. If we were not able to
replace revenues from contracts lost through competitive bidding or early
termination or from the renegotiation of existing contracts with other revenues
within a reasonable time period, the lost revenues could materially and
adversely affect our business and financial results.
WE MAY NOT HAVE ENOUGH CAPITAL OR BE ABLE TO RAISE ENOUGH ADDITIONAL CAPITAL ON
SATISFACTORY TERMS TO MEET OUR CAPITAL REQUIREMENTS
Continued growth will require additional capital. We expect to finance future
acquisitions through cash from operations, borrowings under our credit facility,
issuing additional equity or debt securities and/or seller financing. We expect
that approximately $70.9 million will be outstanding under our credit facility
when this offering is completed. If acquisition candidates are unwilling to
accept, or we are unwilling to issue, shares of our common stock as part of the
consideration for acquisitions or if our common stock does not maintain a
sufficient market value, we may have to use more of our cash or borrowings under
our credit facility to fund acquisitions. Using cash for acquisitions limits our
financial flexibility and makes us more likely to seek additional capital
through future debt or equity financings. If available cash from operations and
borrowings under the credit facility are not sufficient to fund acquisitions, we
will need additional equity and/or debt financing. If we seek more debt, we may
have to agree to financial covenants that limit our operational and financial
flexibility. If we seek more equity, we may dilute the ownership interests of
our then-existing stockholders. We will also need to make substantial capital
expenditures to develop or acquire new landfills, transfer stations and other
facilities and to maintain such properties.
WE DEPEND SIGNIFICANTLY ON THE SERVICES OF THE MEMBERS OF OUR SENIOR MANAGEMENT
TEAM, AND THE DEPARTURE OF ANY OF THOSE PERSONS MIGHT MATERIALLY AND ADVERSELY
AFFECT OUR BUSINESS AND FINANCIAL RESULTS
We currently maintain "key man" life insurance for Ronald J. Mittelstaedt, the
President, Chief Executive Officer and Chairman, in the amount of $3 million.
Key members of our
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management have entered into employment agreements with Waste Connections with
terms ranging from three to five years. We may not be able to enforce these
agreements.
THE GEOGRAPHIC CONCENTRATION OF OUR BUSINESS MAKES OUR OPERATING RESULTS
VULNERABLE TO DOWNTURNS IN REGIONAL ECONOMIES
We operate in eleven states: California, Idaho, Kansas, Minnesota, Nebraska,
Oklahoma, Oregon, South Dakota, Utah, Washington and Wyoming. We expect to focus
our operations on the Western U.S. for at least the foreseeable future. We
estimate that more than 53% of our revenues for the three months ended March 31,
1999 were derived from services provided in Washington, although this percentage
was reduced by the acquisitions we completed in the second quarter of 1999. Our
business and financial results would be harmed by downturns in the general
economy of the Western U.S., particularly in Washington, and other factors
affecting the region, such as state regulations affecting the solid waste
services industry and severe weather conditions. We may not complete enough
acquisitions in other markets to lessen our geographic concentration.
SEASONAL FLUCTUATIONS MAY ADVERSELY AFFECT OUR BUSINESS AND FINANCIAL RESULTS
Based on historic trends experienced by the businesses we have acquired, we
expect our operating results to vary seasonally, with revenues typically lowest
in the first quarter, higher in the second and third quarters, and lower in the
fourth quarter than in the second and third quarters. This seasonality reflects
the lower volume of solid waste generated during the late fall, winter and early
spring months because of decreased construction and demolition activities during
the winter months in the Western U.S. In addition, some of our operating costs
should be generally higher in the winter months. Adverse winter weather
conditions slow waste collection activities, resulting in higher labor and
operational costs. Greater precipitation in the winter increases the weight of
collected waste, resulting in higher disposal costs, which are calculated on a
per ton basis. Because of these factors, we expect operating income to be
generally lower in the winter months.
EXTENSIVE AND EVOLVING ENVIRONMENTAL LAWS AND REGULATIONS MAY ADVERSELY AFFECT
OUR BUSINESS
Environmental laws and regulations have been enforced more and more stringently
in recent years because of greater public interest in protecting the
environment. These laws and regulations impose substantial costs on Waste
Connections and affect our business in many ways, including as described below.
In addition, federal, state and local governments may change the rights they
grant to and the restrictions they impose on solid waste services companies, and
such changes could have a material adverse effect on Waste Connections.
- WE MAY BE UNABLE TO OBTAIN AND MAINTAIN LICENSES OR PERMITS AND ZONING,
ENVIRONMENTAL AND/OR OTHER LAND USE APPROVALS THAT WE NEED TO OWN AND
OPERATE OUR LANDFILLS
These licenses or permits and approvals are difficult and time-consuming
to obtain and renew, and elected officials and citizens' groups
frequently oppose them. Failure to obtain and maintain the permits and
approvals we need to own or operate
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landfills (including increasing their capacity) could materially and
adversely affect our business and financial condition.
- EXTENSIVE REGULATIONS THAT GOVERN THE DESIGN, OPERATION AND CLOSURE OF
LANDFILLS MAY ADVERSELY AFFECT OUR BUSINESS
These regulations include the regulations ("Subtitle D Regulations") that
establish minimum federal requirements adopted by the U.S. Environmental
Protection Agency in October 1991 under Subtitle D of the Resource
Conservation and Recovery Act of 1976. If Waste Connections fails to
comply with these regulations, we could be required to undertake
investigatory or remedial activities, curtail operations or close a
landfill temporarily or permanently. Future changes to these regulations
may require us to modify, supplement or replace equipment or facilities
at substantial costs. If regulatory agencies fail to enforce these
regulations vigorously or consistently, our competitors whose facilities
do not comply with the Subtitle D Regulations or their state counterparts
may obtain an advantage over us. Our financial obligations arising from
any failure to comply with these regulations could materially and
adversely affect our business and financial results.
- WE MAY BE SUBJECT IN THE NORMAL COURSE OF BUSINESS TO JUDICIAL AND
ADMINISTRATIVE PROCEEDINGS INVOLVING FEDERAL, STATE OR LOCAL AGENCIES OR
CITIZENS' GROUPS, WHICH COULD ADVERSELY AFFECT OUR BUSINESS
Governmental agencies may impose fines or penalties on us. They may also
attempt to revoke or deny renewal of our operating permits, franchises or
licenses for violations or alleged violations of environmental laws or
regulations, or to require us to remediate potential environmental
problems relating to waste that we or our predecessors collected,
transported, disposed of or stored. Individuals or community groups might
also bring actions against us in connection with our operations. Any
adverse outcome in these proceedings could have a material adverse effect
on our business and financial results and create adverse publicity about
Waste Connections.
- WE MAY INCUR LIABILITIES FOR ENVIRONMENTAL DAMAGE
We are liable for any environmental damage that our solid waste
facilities cause, including damage to neighboring landowners or
residents, particularly as a result of the contamination of soil,
groundwater or surface water, and especially drinking water. We may be
liable for damage resulting from conditions existing before we acquired
these facilities. We may also be liable for any off-site environmental
contamination caused by pollutants or hazardous substances whose
transportation, treatment or disposal that we or our predecessors
arranged. Any substantial liability for environmental damage could
materially and adversely affect our business and financial results.
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EACH BUSINESS THAT WE ACQUIRE OR HAVE ACQUIRED MAY HAVE LIABILITIES THAT WE FAIL
OR ARE UNABLE TO DISCOVER, INCLUDING LIABILITIES THAT ARISE FROM PRIOR OWNERS'
FAILURE TO COMPLY WITH ENVIRONMENTAL LAWS
As a successor owner, we may be legally responsible for these liabilities. Even
if we obtain legally enforceable representations, warranties and indemnities
from the sellers of such businesses, they may not cover fully the liabilities.
Some environmental liabilities, even if we do not expressly assume them, may be
imposed on Waste Connections under various legal theories. Our insurance program
does not cover liabilities associated with any environmental cleanup or
remediation of our own sites. A successful uninsured claim against Waste
Connections could materially and adversely affect our business and financial
results.
OUR GROWTH MAY BE LIMITED BY THE INABILITY TO OBTAIN NEW LANDFILLS AND EXPAND
EXISTING ONES
We currently own and operate six landfills and operate two other landfills. Our
ability to meet our growth objectives may depend in part on our ability to
acquire, lease and expand landfills and develop new landfill sites. We may not
be able to obtain new landfill sites or expand the permitted capacity of our
landfills when necessary.
IN SOME AREAS IN WHICH WE OPERATE, SUITABLE LAND FOR NEW SITES OR EXPANSION OF
EXISTING LANDFILL SITES MAY BE UNAVAILABLE
Operating permits for landfills in states where we operate must generally be
renewed at least every five years. It has become increasingly difficult and
expensive to obtain required permits and approvals to build, operate and expand
solid waste management facilities, including landfills and transfer stations.
The process often takes several years, requires numerous hearings and compliance
with zoning, environmental and other requirements and is resisted by citizen,
public interest or other groups. We may not be able to obtain or maintain the
permits we require to expand, and such permits may contain burdensome terms and
conditions. Even when granted, final permits to expand are often not approved
until the remaining permitted disposal capacity of a landfill is very low. Local
laws and ordinances also may affect our ability to obtain permits to expand
landfills. If we were to exhaust our permitted capacity at a landfill, our
ability to expand internally would be limited, and we could be required to cap
and close that landfill and forced to dispose of collected waste at more distant
landfills or at landfills operated by our competitors. The resulting increased
costs would materially and adversely affect our business and financial results.
OUR ACCRUALS FOR OUR LANDFILL CLOSURE AND POST-CLOSURE COSTS MAY BE INADEQUATE
We may be required to pay closure and post-closure costs of landfills and any
disposal facilities that we own or operate. We accrue for future closure and
post-closure costs of our owned landfills, generally for a term of 30 years
after final closure of a landfill, based on engineering estimates of consumption
of permitted landfill airspace over the useful life of the landfill. Our
obligations to pay closure or post-closure costs may exceed the amount we
accrued and reserved and other amounts available from funds or reserves
established to pay such costs. This could materially and adversely affect our
business and financial results.
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WE MAY INCUR ADDITIONAL CHARGES RELATED TO CAPITALIZED EXPENDITURES
In accordance with generally accepted accounting principles, we capitalize some
expenditures and advances relating to acquisitions, pending acquisitions and
landfill development projects. As of June 30 1999, we had no capitalized
expenditures relating to landfill development projects and approximately $41,000
in capitalized expenditures relating to pending acquisitions. We expense
indirect acquisition costs such as executive salaries, general corporate
overhead, public affairs and other corporate services as we incur those costs.
We charge against earnings any unamortized capitalized expenditures and advances
(net of any amount that we estimate we will recover, through sale or otherwise)
that relate to any operation that is permanently shut down, any pending
acquisition that is not consummated and any landfill development project that we
do not expect to complete. Therefore, Waste Connections may incur charges
against earnings in future periods, which could materially and adversely affect
our business and financial results.
FAILURE TO COMPLY WITH COVENANTS AND CONDITIONS OF OUR CREDIT FACILITY COULD
ADVERSELY AFFECT OUR BUSINESS
Our credit facility requires us to obtain the consent of the lending banks
before acquiring any other business for more than $20 million in cash and
assumed debt. If we are not able to obtain our banks' consent to acquisitions of
this size, we may not be able to complete them, which could inhibit our growth.
Our credit facility also contains financial covenants based on our current and
projected financial condition after completing an acquisition. If we cannot
satisfy these financial covenants on a pro forma basis after completing an
acquisition, we would not be able to complete the acquisition without a waiver
from our lending banks. Whether or not a waiver is needed, if the results of our
future operations differ materially from what we expect, we may no longer be
able to comply with the covenants in the credit facility. Our failure to comply
with these covenants may result in a default under the credit facility, which
would allow our lending banks to accelerate the date for repayment of debt
incurred under the credit facility and materially and adversely affect our
business and financial results.
FLUCTUATIONS IN PRICES FOR RECYCLED COMMODITIES MAY ADVERSELY AFFECT OUR
OPERATING RESULTS
We provide recycling services to some of our customers. The sale prices of and
demand for recyclable waste products, particularly wastepaper, are frequently
volatile and may adversely affect our operating results.
ADDITIONAL STOCK ISSUANCES MAY AFFECT OUR COMMON STOCK PRICE
If we issue a large number of shares of common stock in connection with future
acquisitions or primary offerings, the market price of our common stock could
decline.
PROVISIONS IN OUR CHARTER AND BYLAWS MAY DETER CHANGES IN CONTROL THAT COULD
BENEFIT OUR STOCKHOLDERS
Certain provisions in our Amended and Restated Certificate of Incorporation and
Amended and Restated By-Laws, and in the Delaware General Corporation Law, may
deter tender offers and hostile takeovers and delay or prevent changes in
control or
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management of Waste Connections, including transactions in which stockholders
might be paid more than current market prices for their shares. These provisions
may also limit our stockholders' ability to approve transactions that they
believe are in their best interests.
WE DO NOT INTEND TO PAY CASH DIVIDENDS ON THE COMMON STOCK
We intend to retain all earnings to help fund the operation and expansion of our
business. In addition, our credit facility prohibits us from paying cash
dividends without the consent of our lenders.
FAILURE TO MAKE TIMELY YEAR 2000 MODIFICATIONS MAY AFFECT OUR OPERATIONS
We will need to modify or replace portions of our software so that our computer
systems will function properly with respect to dates in the year 2000 ("Year
2000") and afterwards. We expect to complete those modifications and upgrades
during 1999 at a total cost of approximately $100,000. Additional acquisitions,
depending on the size of the operation, could increase the budget required for
Year 2000 modifications. We spent part of our Year 2000 budget on replacing our
billing systems in Vancouver, Washington, Idaho Falls and Mountain Home, Idaho,
Orem and Layton, Utah, and Madera and Amador, California. Because our operations
rely primarily on mechanical systems such as trucks to collect solid waste, we
do not expect our operations to be significantly affected by Year 2000 issues.
Our customers may need to make Year 2000 modifications to software and hardware
that they use to generate records, bills and payments relating to Waste
Connections. We do not rely on vendors on a routine basis except for providers
of disposal services. We take waste to a site and are normally billed based on
tonnage disposed. We believe that if our disposal vendors encounter Year 2000
problems, they will convert to manual billing based on scale recordings until
they resolve those issues.
In assessing our exposure to Year 2000 issues, we believe our biggest challenges
lie in the following areas: Year 2000 issues at our banks, large (typically
municipal) customers and acquired businesses between the time we acquire them
and the time we implement our own systems. We are obtaining Year 2000 compliance
certifications from our vendors, banks and customers. If Waste Connections and
our vendors, banks and customers do not complete required Year 2000
modifications on time, the Year 2000 issue could materially affect our
operations. We believe, however, that in the most reasonably likely worst case,
the effects of Year 2000 issues on our operations would be brief and small
relative to our overall operations. We have not made a contingency plan to
minimize operational problems if Waste Connections and our vendors, banks and
customers do not timely complete all required Year 2000 modifications.
USE OF PROCEEDS
We will offer and issue the common stock from time to time in connection with
our acquisition of other solid waste collection, transportation, disposal and
recycling businesses and assets. We will not receive any cash proceeds from
these offerings.
11
<PAGE> 13
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 that we file at the
SEC's public reference rooms in Washington, D.C., Chicago, Illinois and New
York, New York. Please call the SEC at 1-800-732-0330 for more information on
the public reference rooms. Our SEC filings are also available to the public
from commercial document retrieval services and at the web site that the SEC
maintains at "http://www.sec.gov." Our common stock is listed on the Nasdaq
National Market, and you may also inspect and copy our SEC filings at the
offices of the National Association of Securities Dealers, Inc. located at 1735
K Street, N.W., Washington, D.C. 20549.
The SEC allows us to "incorporate by reference" the information we file with the
SEC, which means that we can disclose important information to you by referring
you to those documents. The information incorporated by reference is an
important part of this prospectus, and information that we file later with the
SEC will automatically update and supersede this information. We incorporate by
reference the documents listed below and any future filings we make with the SEC
under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934
until we sell all of the securities:
A. Annual Report on Form 10-K for the year ended December 31, 1998.
B. Quarterly Report on Form 10-Q/A for the quarter ended September 30,
1998, filed January 13, 1999.
C. Quarterly Report on Form 10-Q for the quarter ended March 31, 1999.
D. Quarterly Report on Form 10-Q/A for the quarter ended March 31, 1999.
E. Report on Form 8-K/A dated July 16, 1998.
F. Report on Form 8-K/A dated September 10, 1998.
G. Report on Form 8-K dated January 5, 1999.
H. Report on Form 8-K dated January 13, 1999.
I. Report on Form 8-K dated January 29, 1999.
J. Report on Form 8-K/A dated April 2, 1999.
K. Report on Form 8-K dated April 12, 1999.
L. Report on Form 8-K/A dated April 29, 1999.
M. Report on Form 8-K dated May 7, 1999.
N. Report on Form 8-K/A dated July 14, 1999.
O. The description of our common stock contained in our registration
statement on Form 8-A, File No. 0-23981, filed under the Securities
Exchange Act of 1934.
You may request a copy of these filings at no cost, by writing or telephoning
the office of Steven F. Bouck, Waste Connections, Inc., 2260 Douglas Boulevard,
Suite 280, Roseville, California 95661, telephone (916) 772-2221.
12
<PAGE> 14
SELECTED FINANCIAL INFORMATION
This table sets forth selected financial data of Waste Connections and our
predecessors for the periods indicated. You should read carefully the historical
and supplemental consolidated financial statements and notes included in our
Annual Report on Form 10-K for the year ended December 31, 1998, which is
incorporated by reference in this prospectus. The selected data in this section
are not intended to replace the consolidated financial statements included in
that Report.
The entities Waste Connections acquired in September 1997 from Browning-Ferris
Industries, Inc. ("BFI") are collectively referred to as Waste Connections'
predecessors. BFI acquired the predecessors during 1995 and 1996. Before being
acquired by BFI, the predecessors operated as separate stand-alone businesses.
The selected financial information has been restated to reflect the business
combinations of Waste Connections with Murrey's Disposal Company, Inc., American
Disposal Company, Inc., D.M. Disposal Co., Inc., and Tacoma Recycling Company,
Inc. (collectively, the "Murrey Companies"), Roche & Sons, Inc. and Ritters
Sanitary Service, Inc. (each accounted for as poolings-of-interests).
13
<PAGE> 15
WASTE CONNECTIONS, INC. AND PREDECESSORS
SELECTED FINANCIAL AND OPERATING DATA
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
<TABLE>
<CAPTION>
FIBRES
INTERNATIONAL,
THE INC.
FIBRES DISPOSAL PERIOD FROM
INTERNATIONAL, GROUP WASTE JANUARY 1, PREDECESSORS
INC. COMBINED CONNECTIONS, INC. 1995 ONE MONTH
YEAR ENDED YEAR ENDED YEAR ENDED THROUGH ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, NOVEMBER 30, DECEMBER 31,
1994 1994 1994 1995 1995
-------------- ------------ ----------------- ---------------- ------------
<S> <C> <C> <C> <C> <C>
STATEMENTS OF OPERATIONS DATA(1)(2):
Revenues.................................... $5,610 $22,004 $ 27,699 $7,340 $595
Cost of operations.......................... 4,432 18,298 21,129 5,653 527
Selling, general and administrative......... 552 3,320 2,873 823 72
Depreciation and amortization............... 642 606 1,166 715 74
------ ------- ---------- ------ ----
Income (loss) from operations............... (16) (220) 2,531 149 (78)
Interest expense............................ (191) (548) (374) (162) (1)
Other income (expense), net................. (2) 871 (339) 98 5
------ ------- ---------- ------ ----
Income (loss) before income taxes........... (209) 103 1,818 85 (74)
Income tax (provision) benefit.............. -- -- (534) (29) --
------ ------- ---------- ------ ----
Net income (loss)........................... $ (209) $ 103 $ 1,284 $ 56 $(74)
====== ======= ========== ====== ====
Basic and diluted net income per share...... $ 0.37
==========
Shares used in per share calculation........ 3,443,128
==========
<CAPTION>
THE
DISPOSAL
GROUP
THE COMBINED
DISPOSAL FROM
GROUP WASTE JANUARY 1, PREDECESSORS WASTE
COMBINED CONNECTIONS, INC. 1996 COMBINED CONNECTIONS, INC.
YEAR ENDED YEAR ENDED THROUGH PERIOD ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31, JULY 31, DECEMBER 31, DECEMBER 31,
1995 1995 1996 1996 1996
------------ ----------------- ---------- ------------ -----------------
<S> <C> <C> <C> <C> <C>
STATEMENTS OF OPERATIONS DATA(1)(2):
Revenues.................................... $19,660 $ 32,012 $8,738 $13,422 $ 29,363
Cost of operations.......................... 16,393 23,440 6,174 11,420 23,163
Selling, general and administrative......... 3,312 3,126 2,126 1,649 2,933
Depreciation and amortization............... 628 1,598 324 962 1,788
------- ---------- ------ ------- ----------
Income (loss) from operations............... (673) 3,848 114 (609) 1,479
Interest expense............................ (206) (353) (12) (225) (422)
Other income (expense), net................. -- 224 2,661 (147) 312
------- ---------- ------ ------- ----------
Income (loss) before income taxes........... (879) 3,719 2,763 (981) 1,369
Income tax (provision) benefit.............. 298 (715) (505) -- (568)
------- ---------- ------ ------- ----------
Net income (loss)........................... $ (581) $ 3,004 $2,258 $ (981) $ 801
======= ========== ====== ======= ==========
Basic and diluted net income per share...... $ 0.87 $ 0.23
========== ==========
Shares used in per share calculation........ 3,443,128 3,443,128
========== ==========
</TABLE>
(See footnotes on page 17)
14
<PAGE> 16
<TABLE>
<CAPTION>
PREDECESSORS WASTE CONNECTIONS, INC.
COMBINED ---------------------------------------------------
NINE MONTHS THREE MONTHS ENDED
ENDED YEAR ENDED DECEMBER 31, MARCH 31,
SEPTEMBER 30, ------------------------ ------------------------
1997 1997 1998 1998 1999
------------- ---------- ----------- ---------- -----------
<S> <C> <C> <C> <C> <C>
STATEMENTS OF OPERATIONS
DATA(1)(2):
Revenues...................... $18,114 $ 39,854 $ 91,203 $ 16,478 $ 30,883
Cost of operations............ 14,753 30,300 65,391 12,114 20,120
Selling, general and
administrative.............. 3,009 4,389 9,248 1,631 2,713
Depreciation and
amortization................ 1,083 2,221 6,927 1,166 2,319
Start-up and integration...... -- 493 -- -- --
Stock compensation............ -- 4,395 632 320 70
Acquisition related
expenses.................... -- -- -- -- 7,800
------- ---------- ----------- ---------- -----------
Income (loss) from
operations.................. (731) (1,944) 9,005 1,247 (2,139)
Interest expense.............. (456) (1,533) (2,933) (476) (935)
Other income (expense), net... 14 251 68 (27) 37
------- ---------- ----------- ---------- -----------
Income (loss) before income
taxes....................... (1,173) (3,226) 6,140 744 (3,037)
Income tax (provision)
benefit..................... -- (326) (3,030) (392) (1,325)
------- ---------- ----------- ---------- -----------
Income (loss) before
extraordinary item.......... (1,173) (3,552) 3,110 352 (4,362)
Extraordinary item -- early
extinguishment of debt, net
of income tax benefit of
$264........................ -- -- (1,027) -- --
------- ---------- ----------- ---------- -----------
Net income (loss)............. $(1,173) $ (3,552) $ 2,083 $ 352 $ (4,362)
======= ========== =========== ========== ===========
Redeemable convertible
preferred stock accretion... (531) (917) (572) --
---------- ----------- ---------- -----------
Net income (loss) applicable
to common stockholders...... $ (4,083) $ 1,166 $ (220) $ (4,362)
========== =========== ========== ===========
Basic earnings (loss) per
common share:
Income (loss) before
extraordinary item........ $ (0.77) $ 0.22 $ (0.04) $ (0.28)
Extraordinary item.......... -- (0.10) -- --
---------- ----------- ---------- -----------
Net income (loss) per common
share..................... $ (0.77) $ 0.12 $ (0.04) $ (0.28)
========== =========== ========== ===========
Diluted earnings (loss) per
common share:
Income (loss) before
extraordinary item........ $ (0.77) $ 0.19 $ (0.04) $ (0.28)
Extraordinary item.......... -- (0.09) -- --
---------- ----------- ---------- -----------
Diluted net income (loss)
per common share.......... $ (0.77) $ 0.10 $ (0.04) $ (0.28)
========== =========== ========== ===========
Shares used in calculating
basic net income (loss) per
share....................... 5,315,695 9,903,421 5,754,239 15,472,768
========== =========== ========== ===========
Shares used in calculating
diluted earnings (loss) per
share....................... 5,315,695 11,814,543 5,754,239 15,472,768
========== =========== ========== ===========
</TABLE>
(See footnotes on page 17)
15
<PAGE> 17
<TABLE>
<CAPTION>
FIBRES THE DISPOSAL WASTE THE DISPOSAL WASTE
INTERNATIONAL, GROUP CONNECTIONS, PREDECESSORS GROUP CONNECTIONS,
INC. COMBINED INC. COMBINED COMBINED INC.
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1994 1994 1994 1995 1995 1995
-------------- ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
BALANCE SHEET DATA(1)(2):
Cash and equivalents............. $ 321 $ 203 $ 516 $ 184 $ 961 $ 986
Working capital (deficit)........ 155 (4,279) 792 90 2,498 (169)
Property and equipment, net...... 3,810 2,771 7,974 4,035 2,221 9,384
Total assets..................... 6,317 7,318 11,833 9,151 6,942 14,741
Long-term debt(3)................ 2,353 90 5,940 149 6,890 3,752
Redeemable convertible preferred
stock........................... -- -- -- -- -- --
Total stockholders' equity
(deficit)....................... 3,045 (1,486) 3,170 -- (2,067) 3,908
<CAPTION>
WASTE CONNECTIONS, INC.
PREDECESSORS ------------------------------------------------------
COMBINED DECEMBER 31,
DECEMBER 31, ------------------------------------------ MARCH 31,
1996 1996 1997 1998 1999
------------ ------------ ------------ ------------ ---------
<S> <C> <C> <C> <C> <C>
BALANCE SHEET DATA(1)(2):
Cash and equivalents............. $ 102 $ 327 $ 1,119 $ 3,166 $ 3,361
Working capital (deficit)........ 695 (3,762) (3,092) (12,573) (5,087)
Property and equipment, net...... 5,069 13,618 20,683 48,955 131,586
Total assets..................... 15,291 17,009 41,136 171,421 265,602
Long-term debt(3)................ 89 2,632 11,931 64,933 103,526
Redeemable convertible preferred
stock........................... -- -- 7,523 -- --
Total stockholders' equity
(deficit)....................... -- 6,758 7,719 69,426 131,592
</TABLE>
(See footnotes on page 17)
16
<PAGE> 18
- ---------------
(1) The entities Waste Connections acquired in September 1997 from BFI are
collectively referred to as Waste Connections' predecessors. BFI acquired
the predecessors at various times during 1995 and 1996, and prior to being
acquired by BFI, the predecessors operated as separate stand-alone
businesses. Various factors affect the year-to-year comparability of the
amounts presented. See "Management's Discussion and Analysis of Financial
Condition and Results of Operations -- Results of Operations" in our Annual
Report on Form 10-K for the year ended December 31, 1998, which is
incorporated by reference in this prospectus, for additional information
concerning Waste Connections and our predecessors.
(2) The selected financial data has been restated to reflect the business
combinations with Roche and Sons, Inc., the Murrey Companies and Ritters
Sanitary Service, Inc. which occurred on January 8, January 19 and March 31,
1999, respectively.
(3) Excludes redeemable convertible preferred stock, which converted into common
stock upon our May 1998 initial public offering.
17
<PAGE> 19
SECURITIES COVERED BY THIS PROSPECTUS
This prospectus covers 6,000,000 shares of common stock that we may issue from
time to time connection with our future business acquisitions. The prices we pay
in these acquisitions may consist of cash, assumption of liabilities, common
stock or a combination of one or more of these. We will establish the terms of
these acquisitions by negotiating directly with the owners or principal
executives of the businesses to be acquired. In addition, we may lease property
from and enter into employment, consulting and noncompetition agreements with
former owners and key personnel of the businesses we acquire. We expect that the
common stock we issue in connection with acquisitions will be valued at prices
reasonably related to the common stock's market value, either at the time the
parties agree to an acquisition or when we deliver the shares.
We have also prepared this prospectus, as amended or supplemented if
appropriate, for use by persons who receive shares of our common stock in
acquisitions, including shares sold under this prospectus, and who desire to
sell those shares.
We will not receive any of the proceeds from any such sales. Any commissions
paid or concessions allowed to any broker-dealer and, if any broker-dealer
purchases such shares as principal, any profits received on the resale of such
shares, may be deemed to be underwriting discounts and commissions under the
Securities Act. We will pay printing, certain legal, filing and other similar
expenses of this offering. Selling stockholders will bear all other expenses of
this offering, including any brokerage fees, underwriting discounts or
commissions.
If a selling stockholder notifies us of an arrangement with a broker-dealer to
sell shares through a block trade, special offering, exchange distribution or
secondary distribution, we will file a prospectus supplement pursuant to Rule
424 under the Securities Act. The prospectus supplement will set forth the name
of the selling stockholder and the participating broker-dealer, the number of
shares involved, the price at which those shares were sold, any commissions paid
or discounts or concessions allowed to such broker-dealer, that such
broker-dealer did not conduct any investigation to verify the information in
this prospectus, and other material facts.
Selling stockholders may sell the shares in transactions on the Nasdaq National
Market or on a securities exchange on which our common stock is then listed, in
negotiated transactions or otherwise, at market prices or at negotiated prices.
Selling stockholders may sell the shares in transactions involving
broker-dealers, who may act as agents and/or acquire shares as principals.
Broker-dealers who participate in such transactions as agents may receive
commissions from selling stockholders (and, if they act as agents for the
purchasers of such shares, from such purchasers). Participating broker-dealers
may agree with selling stockholders to sell a specified number of shares at a
stipulated price per share and, to the extent they are unable to do so acting as
agents for the selling stockholders, to purchase as principals any unsold shares
at the price required to fulfill their commitments to the selling stockholders.
The selling stockholders may also sell shares by or through other broker-dealers
in special offerings, exchange distributions or secondary distributions pursuant
to the rules of the Nasdaq National Market or on a securities exchange on which
our common stock is then listed. They may pay brokerage commissions in excess of
the customary commission prescribed by the rules of such securities exchange. In
certain secondary distributions, a
18
<PAGE> 20
discount or concession from the offering price may be allowed to participating
broker-dealers in excess of such customary commission. Broker-dealers who
acquire shares as principals may subsequently resell those shares in
transactions (which may involve crosses and block transactions and which may
involve sales to and through other broker-dealers) on the Nasdaq National Market
or on a securities exchange on which our common stock is then listed, in
negotiated transactions or otherwise, at market prices or at negotiated prices.
In connection with such resales, the broker-dealers may pay to or receive
commissions from the purchasers of such shares.
Each selling stockholder may indemnify any broker-dealer that participates in
transactions involving sales of the shares against certain liabilities,
including liabilities arising under the Securities Act.
LEGAL MATTERS
Shartsis, Friese & Ginsburg LLP, San Francisco, California, has issued an
opinion on the validity of the common stock we are offering. Certain partners
and associate attorneys of Shartsis, Friese & Ginsburg LLP own an aggregate of
3,400 shares of our common stock. Williams, Kastner & Gibbs PLLC, Seattle,
Washington, has issued an opinion regarding certain statements pertaining to our
G certificates awarded by the Washington Utilities and Transportation Commission
that appear in our Annual Report on Form 10-K for the year ended December 31,
1998, which is incorporated by reference in this prospectus.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our financial statements
and schedule included in our Annual Report on Form 10-K for the year ended
December 31, 1998, the combined financial statements of the Murrey Companies
included in our Current Reports on Form 8-K and Form 8-K/A dated January 29,
1999 and April 2, 1999, respectively, and the financial statements of Arrow
Sanitary Service, Inc. included in our Current Report on Form 8-K/A dated July
16, 1998, as set forth in their reports, which are incorporated by reference in
this prospectus and elsewhere in the registration statement. Such financial
statements and schedule are incorporated by reference in reliance on Ernst &
Young LLP's reports, given on their authority as experts in accounting and
auditing.
Perkins & Company, P.C., independent auditors, have audited the combined
financial statements and schedules of Columbia Resource Co., L.P. and
Finley-Buttes Limited Partnership included in our Current Report on Form 8-K/A
dated April 29, 1999, as set forth in their report, which is incorporated by
reference in this prospectus and elsewhere in the registration statement. Such
financial statements and schedules are incorporated by reference in reliance on
Perkins & Company, P.C.'s report, given on their authority as experts in
accounting and auditing.
Grant Thornton LLP, independent certified public accountants, have audited the
financial statements of Shrader Refuse and Recycling Company included in our
Current Report on Form 8-K/A dated September 10, 1998, as set forth in their
report, which is incorporated by reference in this prospectus and elsewhere in
the registration statement. Such financial statements are incorporated by
reference in reliance on Grant Thornton LLP's report, given on their authority
as experts in accounting and auditing.
19
<PAGE> 21
------------------------------------------------------
------------------------------------------------------
YOU SHOULD RELY ONLY ON THE INFORMATION IN THIS PROSPECTUS. WE HAVE NOT
AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION DIFFERENT FROM THAT IN THIS
PROSPECTUS. WE ARE OFFERING TO SELL, AND SEEKING OFFERS TO BUY, SHARES OF COMMON
STOCK ONLY IN JURISDICTIONS WHERE OFFERS AND SALES ARE PERMITTED. THE
INFORMATION IN THIS PROSPECTUS IS CORRECT ONLY AS OF THE DATE OF THIS
PROSPECTUS, REGARDLESS OF WHEN THIS PROSPECTUS IS DELIVERED OR THE COMMON STOCK
IS SOLD.
------------------------
------------------------------------------------------
------------------------------------------------------
------------------------------------------------------
------------------------------------------------------
6,000,000 SHARES
[LOGO]
COMMON STOCK
--------------------
PROSPECTUS
--------------------
JULY , 1999
------------------------------------------------------
------------------------------------------------------
<PAGE> 22
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Amended and Restated Certificate of Incorporation (the "Restated
Certificate") of the Company provides that a director will not be personally
liable to the Company or its stockholders for monetary damages for breach of
fiduciary duty as a director, except for liability (i) for any breach of the
director's duty of loyalty to the corporation or its stockholders, (ii) for acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the Delaware General
Corporation Law (the "Delaware Law"), which concerns unlawful payments of
dividends, stock purchases or redemptions, or (iv) for any transaction from
which the director derived an improper personal benefit. If the Delaware Law is
subsequently amended to permit further limitation of the personal liability of
directors, the liability of a director of the Company will be eliminated or
limited to the fullest extent permitted by the Delaware Law as amended.
Section 145(a) of the Delaware Law provides that a corporation may indemnify any
person who was or is a party or is threatened to be 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 the corporation) by reason of the fact that he 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
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
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 conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction, or upon a
plea of non contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interest of the
corporation, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.
Section 145(b) of the Delaware Law states that a corporation may indemnify any
person who was or is 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 he is
or was a director, officer, employee or agent of the corporation, or is or was
serving at the request or agent of another corporation, partnership, joint
venture, trust or other enterprise against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation and except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit is brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of
II-1
<PAGE> 23
the case, such person is fairly and reasonably entitled to indemnity for such
expenses which the Court of Chancery or such other court shall deem proper.
Section 145(c) of the Delaware Law provides that to the extent that a director,
officer, employee or agent of a corporation has been successful on the merits or
otherwise in defense of any action, suit or proceeding referred to in
subsections (a) and (b) of section 145, or in defense of any claim, issue or
matter therein, he shall be indemnified against expenses (including attorneys'
fees) actually and reasonably incurred by him in connection therewith.
Section 145(d) of the Delaware Law states that any indemnification under
subsections (a) and (b) of section 145 (unless ordered by a court) shall be made
by the corporation only as authorized in the specific case upon a determination
that indemnification of the director, officer, employee or agent is proper in
the circumstances because he has met the applicable standard of conduct set
forth in subsections (a) and (b). Such determination shall be made (i) by the
board of directors by a majority vote of a quorum consisting of directors who
were not parties to such action, suit or proceeding, or (ii) if such a quorum is
not obtainable, or, even if obtainable, a quorum of disinterested directors so
directs, by independent legal counsel in a written opinion, or (iii) by the
stockholders.
Section 145(e) of the Delaware Law 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 he is not
entitled to be indemnified by the corporation as authorized in section 145. Such
expenses (including attorneys' fees) incurred by other employees and agents may
be so paid upon such terms and conditions, if any, as the board of directors
deems appropriate.
Section 145(f) of the Delaware Law states that the indemnification and
advancement of expenses provided by, or granted pursuant to, the other
subsections of section 145 shall not be deemed 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 his official capacity and as to action in
another capacity while holding such office.
Section 145(g) of the Delaware Law provides that a corporation shall have the
power 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 him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the corporation
would have the power to indemnify him against such liability under the
provisions of section 145.
Section 145(j) of the Delaware Law states that the indemnification and
advancement of expenses provided by, or granted pursuant to, section 145 shall,
unless otherwise provided when authorized or ratified, continue as to a person
who has ceased to be a director, officer, employee or agent, and shall inure to
the benefit of the heirs, executors and administrators of such a person.
II-2
<PAGE> 24
Pursuant to Section 145 of the Delaware Law, the Registrant has purchased
insurance on behalf of its present and former directors and officers against any
liability asserted against or incurred by them in such capacity or arising out
of their status as such. The Company has entered into indemnification agreements
with each of its directors and officers providing for mandatory indemnification
and advancement of expenses to the maximum extent permitted by the Delaware Law.
ITEM 21. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
- --------- ----------------------
<S> <C>
5.1 Opinion of Shartsis, Friese & Ginsburg LLP
23.1 Consent of Shartsis, Friese & Ginsburg LLP (included in
Exhibit 5.1)
23.2 Consent of Ernst & Young LLP, Independent Auditors
23.3 Consent of Perkins & Company, P.C., Independent Auditors
23.4 Consent of Grant Thornton LLP, Independent Certified Public
Accountants
23.5 Consent of Williams, Kastner & Gibbs PLLC
24.1 Power of Attorney (included in Part II of the Registration
Statement under the caption "Signatures")
</TABLE>
ITEM 22. UNDERTAKINGS
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) 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.
(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
II-3
<PAGE> 25
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.
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 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.
The undersigned Registrant hereby undertakes that prior to any public reoffering
of the securities registered hereunder through use of a prospectus which is part
of this Registration Statement, by any person or party who is deemed to be an
underwriter within the meaning of Rule 145(c), such reoffering prospectus will
contain the information called for by the applicable registration form with
respect to reofferings by persons who may be deemed underwriters, in addition to
the information called for by the other items of the applicable form.
The undersigned Registrant undertakes that every prospectus that (i) is filed
pursuant to the immediately preceding paragraph, or (ii) purports to meet the
requirements of section 10(a)(3) of the Securities Act of 1933 and is used in
connection with an offering of securities subject to Rule 415, will be filed as
part of an amendment to the Registration Statement and will not be used until
such amendment is effective, and that, for purposes 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.
The undersigned Registrant hereby undertakes to respond for requests for
information that is incorporated by reference into the prospectus pursuant to
Item 4, 10(b), 11 or 13 of this form, within one business day of receipt of such
request, and to send the incorporated documents by first class mail or other
equally prompt means. This includes information in documents filed subsequent to
the effective date of the Registration Statement through the date of responding
to the request.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 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 Commission such indemnification is
against public policy as expressed in the Securities Act of 1993 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
successful 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
II-4
<PAGE> 26
policy as expressed in the Securities Act of 1993 and will be governed by the
final adjudication of such issue.
The undersigned Registrant hereby undertakes to supply by means of a
post-effective amendment all information concerning a transaction, and the
company being acquired involved therein, that was not the subject of and
included in the Registration Statement when it became effective, except where
the transaction in which the securities being offered pursuant to this
Registration Statement would be exempt from registration (but for the
possibility of integration) and which have an immaterial effect on the
Registrant.
II-5
<PAGE> 27
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant has
duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Roseville, State of
California, on July 27, 1999.
WASTE CONNECTIONS, INC.
By: /s/ RONALD J. MITTELSTAEDT
------------------------------------------
Ronald J. Mittelstaedt
President, Chief Executive Officer and
Chairman
Each person whose signature appears below hereby appoints Ronald J. Mittelstaedt
and Steven F. Bouck, and each of them, each of whom may act without joinder of
the other, as his or her true and lawful attorney-in-fact and agent, with full
power of substitution and resubstitution, for his or her and in his or her name,
place and stead, in any and all capacities, to execute in the name and on behalf
of such person any amendment or any post-effective amendment to this
Registration Statement, and any registration statement relating to any offering
made in connection with the offering covered by this Registration Statement that
is to be effective on filing pursuant to Rule 462(b) under the Securities Act of
1933, as amended, and to file the same, with exhibits thereto, and other
documents in connection therewith, with the Commission, granting unto said
attorneys-in-fact and agents full power and authority to do and perform each and
every act and thing appropriate or necessary to be done, as fully and for all
intents and purposes as he or she might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents or their substitute or
substitutes may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the following persons in the capacities indicated
on July 27, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ RONALD J. MITTELSTAEDT President, Chief Executive July 27, 1999
- --------------------------------------------- Officer and Chairman
Ronald J. Mittelstaedt
/s/ EUGENE V. DUPREAU Director and Vice President -- July 27, 1999
- --------------------------------------------- California Division
Eugene V. Dupreau
/s/ MICHAEL W. HARLAN Director July 27, 1999
- ---------------------------------------------
Michael W. Harlan
/s/ WILLIAM J. RAZZOUK Director July 27, 1999
- ---------------------------------------------
William J. Razzouk
/s/ STEVEN F. BOUCK Executive Vice President and July 27, 1999
- --------------------------------------------- Chief Financial Officer
Steven F. Bouck
/s/ MICHAEL R. FOOS Vice President and Corporate July 27, 1999
- --------------------------------------------- Controller
Michael R. Foos
/s/ IRMGARD R. WILCOX Director July 27, 1999
- ---------------------------------------------
Irmgard R. Wilcox
</TABLE>
II-6
<PAGE> 28
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT PAGE
NUMBER DESCRIPTION OF EXHIBITS NUMBER
- -------- ----------------------- ------
<C> <S> <C>
5.1 Opinion of Shartsis, Friese & Ginsburg LLP.................
23.1 Consent of Shartsis, Friese & Ginsburg LLP (included in
Exhibit 5.1)...............................................
23.2 Consent of Ernst & Young LLP, Independent Auditors.........
23.3 Consent of Perkins & Company, P.C., Independent Auditors...
23.4 Consent of Grant Thornton LLP, Independent Certified Public
Accountants................................................
23.5 Consent of Williams, Kastner & Gibbs PLLC..................
24.1 Power of Attorney (included in Part II of the Registration
Statement under the caption "Signatures")..................
</TABLE>
II-7
<PAGE> 1
EXHIBIT 5.1
July 27, 1999
Waste Connections, Inc.
2260 Douglas Boulevard, Suite 280
Roseville, California 95661
Ladies and Gentlemen:
We have acted as counsel for Waste Connections, Inc. (the "Company") in
connection with its Registration Statement on Form S-4 filed on July 27, 1999,
with the Securities and Exchange Commission under the Securities Act of 1933, as
amended, relating to up to 6,000,000 shares of the Company's Common Stock, $0.01
par value, to be sold by the Company. We are of the opinion that the shares
being so registered for sale have been duly authorized and, when sold and
delivered as contemplated in such Registration Statement, will be validly
issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion with the Securities and
Exchange Commission as an exhibit to such Registration Statement.
Very truly yours,
SIIARTSIS, FRIESE & GINSBURG LLP
By /s/ Carolyn S. Reiser
--------------------------------------
Carolyn S. Reiser
<PAGE> 1
EXHIBIT 23.2
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-4) and related Prospectus of Waste Connections,
Inc. for the registration of 6,000,000 shares of its common stock and to the
incorporation by reference therein of our reports listed below:
Report dated February 17, 1999 with respect to the financial statements and
schedule of Waste Connections, Inc. and Predecessors included in the Waste
Connections, Inc. Annual Report (Form 10-K) for the year ended December 31,
1998, filed with the Securities and Exchange Commission;
Report dated February 17, 1999 with respect to the supplemental
consolidated financial statements of Waste Connections, Inc. and
Predecessors included in the Waste Connections, Inc. Annual Report (Form
10-K) for the year ended December 31, 1998, filed with the Securities and
Exchange Commission;
Report dated February 4, 1999 with respect to the combined financial
statements of The Murrey Companies (which consist of Murrey's Disposal
Company, Inc., American Disposal Company, Inc., D.M. Disposal Co., Inc. and
Tacoma Recycling Company, Inc.) included in the Current Report on Form
8-K/A dated April 2, 1999 of Waste Connections, Inc., filed with the
Securities and Exchange Commission;
Report dated October 2, 1998 (except for Note 12, as to which the date is
October 22, 1998) with respect to the combined financial statements of The
Murrey Companies (which consist of Murrey's Disposal Company, Inc.,
American Disposal Company, Inc., D.M. Disposal Co., Inc. and Tacoma
Recycling Company, Inc.) included in the Current Report on Form 8-K dated
January 29, 1999 of Waste Connections, Inc., filed with the Securities and
Exchange Commission; and
Report dated July 8, 1998, with respect to the financial statements of
Arrow Sanitary Service, Inc. included in the Current Report on Form 8-K/A
dated July 16, 1998 of Waste Connections, Inc., filed with the Securities
and Exchange Commission.
ERNST & YOUNG LLP
Sacramento, California
July 27, 1999
<PAGE> 1
EXHIBIT 23.3
CONSENT OF PERKINS & COMPANY, P.C., INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-4) of Waste Connections, Inc. for
the registration of 6,000,000 shares of its common stock and to the
incorporation by reference therein of our report dated March 9, 1999 (except for
the second paragraph of Note 12, as to which the date is March 31, 1999) with
respect to the combined financial statements of Columbia Resource Co., L.P. and
Finley-Buttes Limited Partnership included in the Current Report on Form 8-K/A
dated April 29, 1999 of Waste Connections, Inc., filed with the Securities and
Exchange Commission
/s/ Perkins & Company, P.C.
PERKINS & COMPANY, P.C.
Portland, Oregon
July 27, 1999
<PAGE> 1
EXHIBIT 23.4
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We have issued our report dated August 24, 1998 accompanying the financial
statements of Shrader Refuse and Recycling Service Company appearing in the Form
8-K/A dated September 10, 1998 of Waste Connections, Inc. which is incorporated
by reference in this Registration Statement. We consent to the incorporation by
reference in the Registration Statement and related Prospectus of the
aforementioned report and to the use of our name as it appears under the caption
"Experts."
GRANT THORNTON LLP
Lincoln, Nebraska
July 27, 1999
<PAGE> 1
EXHIBIT 23.5
CONSENT OF WILLIAMS, KASTNER & GIBBS PLLC
We consent to the reference to our firm under the caption "Legal Matters" in the
July 1999 Registration Statement (Form S-4) of Waste Connections, Inc. with
respect to 6,000,000 shares of common stock (Registration No. 333- ).
WILLIAMS, KASTNER & GIBBS PLLC
Seattle, Washington
July 26, 1999
