<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 31, 2000
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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RAILWORKS CORPORATION
(Exact name of registrant as specified in its charter)
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<TABLE>
<S> <C>
DELAWARE 58-2382378
(State or other jurisdiction of incorporation (I.R.S. Employer Identification No.)
or organization)
</TABLE>
RAILWORKS CORPORATION
6225 SMITH AVENUE
SUITE 200
BALTIMORE, MARYLAND 21209
(410) 580-6000
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
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JOHN G. LARKIN
RAILWORKS CORPORATION
6225 SMITH AVENUE
SUITE 200
BALTIMORE, MARYLAND 21209
(410) 580-6000
(Name, address, including zip code, and telephone number, including area
code, of agent for service)
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COPIES TO:
MARY A. BERNARD
KING & SPALDING
1185 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10036
(212) 556-2100
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: From time to
time after the effective date of this Registration Statement, as determined in
light of market conditions.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
---------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
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PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF SHARES AMOUNT TO BE AGGREGATE PRICE AGGREGATE AMOUNT OF
TO BE REGISTERED REGISTERED PER SHARE(1) OFFERING PRICE(1) REGISTRATION FEE
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<S> <C> <C> <C> <C>
Common stock, par value $.01 per
share............................ 3,859,830 $2.56 $9,803,968.20 $2,588.25
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</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457(c).
---------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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<PAGE> 2
PROSPECTUS
RAILWORKS CORPORATION
---------------------
3,859,830 SHARES OF COMMON STOCK
(PAR VALUE $.01 PER SHARE)
---------------------
This prospectus relates to the offering from time to time of up to
3,859,830 shares of common stock of RailWorks Corporation by certain of our
stockholders. We will not receive any of the proceeds from the sale of the
shares being offered. We are registering the resale of these shares, but the
registration of such shares does not necessarily mean that any of such shares
will be offered or sold by the selling stockholders.
The selling stockholders from time to time may offer and sell the shares
directly to purchasers or through agents, underwriters or dealers on terms to be
determined at the time of sale. If required, the names of any agents,
underwriters or dealers and any other required information will be set forth in
an accompanying prospectus supplement.
The common stock is listed on the Nasdaq National Market under the symbol
"RWKS." On October 25, 2000, the last sale price of the common stock as reported
on the Nasdaq National Market was $2.50 per share. Shares of common stock
offered pursuant to this prospectus will be approved for trading on the Nasdaq
National Market.
INVESTING IN THE COMMON STOCK INVOLVES CERTAIN RISKS. SEE "RISK FACTORS"
BEGINNING ON PAGE 4 FOR A DISCUSSION OF THESE RISKS.
---------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF 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 November , 2000.
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
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PAGE
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<S> <C>
About this Prospectus....................................... 2
Where You Can Find More Information......................... 2
Special Note Regarding Forward-Looking Statements........... 3
RailWorks Corporation....................................... 4
Risk Factors................................................ 4
Use of Proceeds............................................. 8
Selling Stockholders........................................ 8
Plan of Distribution........................................ 9
Validity of Common Stock.................................... 10
Experts..................................................... 10
</TABLE>
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
SEC using a "shelf" registration process. Under this shelf process, certain of
our stockholders, which we refer to as the selling stockholders, may sell up to
an aggregate of 3,859,830 shares of common stock in one or more offerings. This
prospectus provides you with a general description of the common stock. You
should read this prospectus and any applicable prospectus supplement provided to
you together with the additional information described under the heading "Where
You Can Find More Information."
The registration statement that contains this prospectus (including the
exhibits to the registration statement) contains additional information about
our company and the securities offered under this prospectus. That registration
statement can be read at the SEC web site or at the SEC offices mentioned under
the heading "Where You Can Find More Information."
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. Our SEC filings are available to the public over the
Internet at the SEC's web site at http://www.sec.gov. You may also read and copy
any document we file with the SEC at its public reference facilities at 450
Fifth Street, N.W., Washington, D.C. 20549. You can also obtain copies of the
documents at prescribed rates by writing to the Public Reference Section of the
SEC at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330 for further information on the operation of the public reference
facilities. Our SEC filings are also available at the office of the Nasdaq
National Market, Inc. at 1735 K Street, N.W., Washington, D.C. 20006-1506.
The SEC allows us to incorporate by reference into this prospectus the
information that we file with the SEC, which means that we disclose important
information to you by referring to such documents. The information incorporated
by reference is an important part of this prospectus and the accompanying
prospectus supplement. In addition, any information that we file with the SEC
subsequent to the date of this prospectus will automatically update this
prospectus. We incorporate by reference the documents listed below and any
filings that we make with the SEC under sections 13(a), 13(c), 14 or 15(d) of
the Securities Exchange Act of 1934 after the initial filing of the registration
statement that contains this prospectus and prior to the time that the selling
stockholders sell all of the common stock offered by this prospectus:
- Annual Report on Form 10-K for fiscal year ended December 31, 1999,
- Quarterly Reports on Form 10-Q for the quarters ended March 31, 2000 and
June 30, 2000, and
- The description of the common stock included in our Registration
Statement on Form 8-A dated July 20, 1998.
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<PAGE> 4
You may request a copy of these filings (other than an exhibit to a filing
unless that exhibit is specifically incorporated by reference into that filing)
at no cost, by writing to or telephoning us at the following address:
RailWorks Corporation
6225 Smith Avenue
Suite 200
Baltimore, Maryland 21209
(410) 580-6000
You should only rely on the information incorporated by reference or set
forth in this prospectus or any applicable prospectus supplement. We have not
authorized anyone else to provide you with different information. We are only
offering these securities in states where the offer is permitted. You should not
assume that the information in this prospectus or the applicable prospectus
supplement is accurate as of any date other than the dates on the front of such
documents.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus may incorporate by reference forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933. These
statements may be included in the information incorporated by reference above
under "Where You Can Find More Information." We use the words "believes,"
"anticipates," "expects," "estimates," "plans," "intends" and similar
expressions so as to identify forward-looking statements. All forward-looking
statements involve substantial risks and uncertainties. There may be events in
the future that we are not accurately able to predict, or over which we have no
control. Some factors that may cause actual results to differ from projected
results are:
- the absence of a combined operating history of the operating companies
and difficulties in integrating their operations;
- unanticipated difficulties or delays in implementing our acquisition
program;
- cyclicality in the demand for rail system services and products;
- availability of capital, including our ability to service or refinance
indebtedness;
- an unanticipated decrease in public sector contracts and funding;
- changes in our relationships with major customers;
- effects of changes in general economic conditions;
- actions by competitors; and
- ability to retain qualified personnel.
Forward-looking statements include, without limitation, our expectations
and estimates as to development of our services and products and expansion of
our customer base, future financial performance, including growth in revenues
and earnings and the effect on our finances of new acquisitions, cash flows from
operations, acquisitions, capital expenditures, the availability of funds from
credit facilities and the sale of securities.
Consequently, you should regard forward-looking statements only as our
current plans, estimates and beliefs. We do not promise to notify you if we
learn that our assumptions or projections are wrong for any reason. Before you
decide to invest in shares of common stock you should be aware that the factors
we discuss in the "Risk Factors" section in this prospectus could cause our
actual results to differ from what we have stated in any forward-looking
statements.
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RAILWORKS CORPORATION
We are a leading provider of integrated rail system services and products
to a diverse base of customers throughout the United States. We believe we are
positioned to grow significantly due to our ability to comprehensively design,
supply, construct and maintain rail systems. Our strategy is based on providing
a full range of rail-related services and products on a "turnkey" basis
throughout North America and offering rail system solutions under the
"RailWorks" brand. We provide track construction, rehabilitation, repair and
maintenance; rail electrification and installation of communication and
signaling systems; and related products and supplies. We offer these services to
a wide variety of customers, including Class I and shortline railroads, publicly
funded transit authorities and commercial and industrial companies. We also
provide non-rail products and services such as electrical contracting, bridge
and highway support structures, and related concrete products.
We are incorporated under the laws of the State of Delaware. Our principal
executive offices are located at 6225 Smith Avenue, Suite 200, Baltimore,
Maryland 21209, and our telephone number is (410) 580-6000. Unless the context
otherwise requires, all references to us include our consolidated subsidiaries.
RISK FACTORS
You should carefully consider the following factors and other information
in this prospectus before deciding to invest in shares of common stock.
THE OPERATING COMPANIES DO NOT HAVE A COMBINED OPERATING HISTORY; WE MAY BE
UNSUCCESSFUL INTEGRATING THEIR DECENTRALIZED OPERATIONS
RailWorks was founded in March 1998 but conducted no operations and
generated no revenue until we completed the initial public offering, or IPO, of
our common stock in August 1998. We acquired 14 groups of companies, which we
refer to as the Founding Companies, concurrently with the completion of our IPO.
We have acquired an additional 19 operating companies through June 30, 2000. Our
operating companies were separate independent entities before we acquired them
and to a certain extent they continue to operate as independent entities because
we conduct our operations on a decentralized basis. The integration of our
operating companies, while allowing them to retain decentralized operations and
management, is important to our operating and growth strategies and the
achievement of efficiencies in the combined operations. We may not be able to
integrate the operations or the necessary systems and procedures, including
accounting and financial reporting systems and project management systems, to
manage effectively the combined enterprise. Certain members of our management
group have only recently joined RailWorks and there can be no assurance that the
management group will be able to implement our acquisition and operating
strategies. We cannot assure you that we will be able to establish, maintain or
increase the profitability of the operating companies. Any failure by our
management group to implement our strategies, integrate the operating companies
without substantial costs, delays or other operational or financial
difficulties, or effectively oversee the combined entity could have a material
adverse effect on our business, financial condition and results of operations.
WE MAY BE UNABLE TO COMPLETE AND FINANCE ACQUISITIONS
We have completed a significant number of acquisitions since the IPO and
may continue to grow through acquisitions. Unforeseen expenses, difficulties,
complications and delays frequently encountered in connection with acquisitions
could inhibit our growth or adversely affect our financial performance. We
cannot assure you that we will maintain our growth or anticipate all of the
changing demands that acquisitions will impose on our management, personnel,
operational and management information systems and financial systems. We may not
be able to identify, acquire or manage profitably additional businesses or to
integrate successfully any acquired businesses without substantial costs, delays
or other operational or financial difficulties. Any of these occurrences could
have a material adverse effect on our business, financial condition and results
of operations. In addition, our acquisitions typically provide for the sellers
to
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receive contingent consideration, which is only paid if the acquired companies
achieve certain operating results. These payments could be substantial.
WE MAY BE UNABLE TO GENERATE INTERNAL GROWTH
Our ability to grow has been and will continue to be affected by various
factors, including demand for rail system services and products, our success in
bidding on new projects, the success of our cross-selling efforts and our
ability to develop a national accounts program. Our growth may also depend on
increased outsourcing by rail system operators. Many of these factors are beyond
our control. Our strategies may not be successful or we may be unable to
generate cash flow adequate for combined operations and to support internal
growth. The senior managers of the operating companies retain responsibility for
day-to-day operations. If proper business controls are not implemented and
maintained, this decentralized operating strategy could result in inconsistent
operating and financial practices of the operating companies, which could have a
material adverse effect on our business, financial condition and results of
operations.
WE HAVE SUBSTANTIAL LEVERAGE
Our substantial indebtedness could adversely affect our financial health.
We have a substantial amount of debt outstanding. As of June 30, 2000, we had
outstanding total debt of $368.0 million, a ratio of earnings to fixed charges
of 1.86 and stockholders' equity of $154.9 million. Despite current indebtedness
levels, we and our subsidiaries may incur substantial additional debt in the
future. As of June 30, 2000, $89.5 million was available for additional
borrowing under our credit facility (subject to customary borrowing conditions).
If new debt is added to our and our subsidiaries' current debt levels, the
related risks that we and they now face could intensify.
Our substantial amount of debt could have important consequences for you.
For example, it could:
- limit our ability to obtain additional financing, if we need it, for
working capital, capital expenditures, acquisitions, debt service
requirements or other purposes;
- increase our vulnerability to adverse economic and industry conditions;
- require us to dedicate a substantial portion of our cash flow from
operations to payments on our debt, thereby reducing funds available for
operations, future business opportunities or other purposes;
- limit our flexibility in planning for, or reacting to, changes in our
business and the industry in which we compete; and
- place us at a competitive disadvantage compared to our competitors that
have less debt.
To service our indebtedness, we will require a significant amount of cash.
Our ability to make payments on our debt and to fund planned capital
expenditures and acquisitions will depend on our future operating performance
and on our ability to successfully implement our business strategy. Prevailing
general economic conditions and financial, business, regulatory and other
factors, many of which are beyond our control, will affect our ability to make
these payments. If future cash flow is not sufficient to make scheduled payments
on our debt, we will need to refinance all or a portion of our debt before
maturity, obtain additional financing, delay planned acquisitions and capital
expenditures, or sell assets. Any such event could have a material adverse
effect on our business, financial condition and results of operations.
WE HAVE BEEN DEPENDENT ON CERTAIN CUSTOMERS
We derived approximately 40.0% of our pro forma revenue for the year ended
December 31, 1999 from our top ten customers. Approximately 17.0% of our 1999
pro forma revenue was derived from projects undertaken for the New York City
Transit Authority, which we refer to as NYCTA. These projects were undertaken
under a number of separate contracts. If the NYCTA were to significantly
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reduce the amount of business that it does with us or determine not to do
business with us in the future, it would have a material adverse effect on our
business, financial condition and results of operations.
CERTAIN OPERATING COMPANIES HAVE A HISTORY OF LOSSES
From time to time, primarily due to industry cyclicality and uncertainties
inherent in the competitive bidding process, certain of our operating companies
have experienced net losses. See "-- Our Fixed Price Contracts Expose us to
Significant Risks" below. We cannot assure you that we or our operating
companies will be profitable in the future.
WE FACE INTENSE COMPETITION
The rail system services and products industry is highly competitive.
Numerous companies provide services to transit authorities, construct and repair
rail systems or sell related products or supplies, and some of these companies
operate in more than one of these lines of business. Some of our competitors
have greater resources than we have, may also provide a broad range of services
and products, and may have sufficient bonding capacity and other resources to
undertake large projects. Any inability to compete successfully against our
existing and future competitors would have a material adverse effect on our
business, financial condition and results of operations. Certain of our
operating companies also provide electrical contracting services to non-rail
industrial and commercial customers. While we believe that we currently compete
effectively in the non-rail electrical contracting business, this industry is
highly competitive and is served by small, owner-operated private companies,
public companies and several large regional companies. Additionally, we could
face competition in the future from other competitors entering our markets.
WE ARE DEPENDENT ON PUBLIC SECTOR CONTRACTS AND FUNDING
The rail system services and products business involves contracts that are
supported by funding from federal, state and local governmental agencies, as
well as contracts with such agencies, which we refer to as "public sector
contracts". Public sector contracts are subject to detailed regulatory
requirements and public policies, as well as funding priorities. These contracts
may be conditioned upon the continuing availability of public funds; the
availability of public funds depends upon lengthy and complex budgetary
procedures. These contracts may also be subject to significant pricing
constraints. Moreover, public sector contracts may generally be terminated for
reasons beyond the control of the contractor, including when such termination is
in the best interests of the governmental agency. We cannot assure you that
these factors or others unique to public sector contracts will not have a
material adverse effect on our business, financial condition and results of
operations.
OUR FIXED PRICE CONTRACTS EXPOSE US TO SIGNIFICANT RISKS
Fixed price contracts are typically awarded in the rail system services
industry pursuant to a competitive bidding process. In compiling our bid on a
particular project, we must estimate the time it will take to complete the
project, along with the project's labor and supply costs. These costs may be
affected by a variety of factors, some of which may be beyond our control. If we
cannot accurately predict the costs of fixed price contracts, certain projects
could have lower margins than anticipated or we could suffer losses on the
projects. Lower margins and losses could have a material adverse effect on our
business, financial condition and results of operations.
WE RELY ON SUBCONTRACTORS AND SUPPLIERS
We generally perform electrical contracting services for transit signaling
and communication systems as a subcontractor to companies that design the
systems and manufacture or purchase the necessary equipment. In other instances,
we act as the prime contractor and subcontract the design of the signal or
communication system and necessary equipment. When we are a prime contractor for
such projects, we generally require subcontractors to post performance bonds. We
may not require a subcontractor to post a
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performance bond in situations where (1) the subcontractor has strong experience
with a specific type of project and demonstrates financial stability and (2) the
customer does not require bonds from us as prime contractor. We sometimes depend
upon the subcontractor to perform design and other services and provide
equipment. For certain projects only a limited number of companies can perform
the subcontract if the initial subcontractor defaults. As a result, we depend
upon our subcontractors to perform under the subcontracts. Further, the major
components of signaling and communication systems for transit authorities are
manufactured to specifications and require long lead times for production. If a
subcontractor or supplier defaults, or if a supplier refuses or cannot do
business with us, it could have a material adverse effect on our business,
financial condition and results of operations.
THE RAIL SYSTEM INDUSTRY IS CYCLICAL
We derive a substantial portion of our revenue from public contracts, which
we expect will constitute a relatively stable source of business due to funding
provided by the Transportation Equity Act for the 21st Century which we refer to
as TEA 21. However, demand for rail system services and products could fluctuate
in conjunction with overall economic conditions. In economic downturns, rail
system operators may defer certain construction and rehabilitation projects and
purchases of related products to conserve cash in the short term. Reductions in
freight traffic due to economic downturns or other factors may also reduce
demand for our construction and rehabilitation services and related products. In
economic upturns, railroads, particularly Class I railroads, experience heavier
traffic demands that can cause problems associated with congestion. The
operational problems related to congestion have an unpredictable impact on
railroad expenditures for construction and rehabilitation services and related
products, including those we provide. During periods of peak usage, rail system
owners may defer certain expenditures because they may need to address
operational challenges these conditions cause. Other issues, such as the
possibility of heightened government regulation during periods of congestion and
the internal challenges of managing railroad operations as the Class I railroads
continue to consolidate, may exacerbate the effects of these uncertainties.
WE ARE EXPOSED TO DOWNTURNS IN COMMERCIAL CONSTRUCTION
We derived a significant portion of our revenue for the year ended December
31, 1999 from installation of electrical systems in newly constructed or
renovated commercial buildings and power and industrial plants. The demand for
electrical installation services is affected by fluctuations in the level of new
construction and renovation of commercial buildings. These fluctuations reflect
the cyclical nature of the construction industry and depend upon general
economic conditions, changes in interest rates and other related factors.
Downturns in levels of commercial construction and renovation could have a
material adverse effect on our business, financial condition and results of
operations. Further, our electrical installation business is focused in the
northeastern United States and is therefore particularly susceptible to economic
downturns in that region.
OUR WORKFORCE IS UNIONIZED
As of June 30, 2000, approximately 35% of our employees were covered under
collective bargaining agreements. In June 1994, one of our operating companies
was affected by a one-week work stoppage by the United Brotherhood of Teamsters.
We cannot assure you that future work stoppages will not affect us. In addition,
labor agreements are generally negotiated on an industry-wide basis and the
terms and conditions of future labor agreements could be beyond our control. We
may be subject to terms and conditions in future labor agreements that could
have a material adverse effect on our business, financial condition and results
of operations.
WE ARE SUBJECT TO EXTENSIVE ENVIRONMENTAL AND GOVERNMENT REGULATION
Our operations are subject to extensive federal, state and local regulation
under environmental laws and regulations. Among other things, these laws and
regulations cover emissions to the air, discharges to waters and the generation,
handling, storage, transportation, treatment and disposal of waste, underground
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and aboveground storage tanks and remediation of soil and groundwater
contamination. Environmental liability can extend to previously owned or
operated properties, leased properties and properties owned by third parties, as
well as to properties currently owned and used by us. Environmental liabilities
may also arise from claims asserted by adjacent landowners or other third
parties in toxic tort litigation. We could incur significant ongoing costs
associated with environmental regulatory compliance. Further, we sometimes use
hazardous materials in connection with our operations. Although we believe that
we materially comply with all of the various environmental regulations
applicable to our business, we cannot assure you that requirements will not
change in the future or that we will not incur significant costs to comply with
such requirements. In addition to safety, health and other regulations of
general applicability, our operations may be significantly affected by
regulations of the Surface Transportation Board, the Federal Railroad
Administration, the Occupational Safety and Health Administration, state
departments of transportation and other state and local regulatory agencies.
Changes in regulation of the rail and transit industries through legislative,
administrative, judicial or other action could have a material adverse effect on
our business, financial condition and results of operations.
WE ARE DEPENDENT ON KEY PERSONNEL
Our success depends to a significant extent upon the efforts and abilities
of John G. Larkin, Chairman of the Board and Chief Executive Officer, and
Michael R. Azarela, Executive Vice President and Chief Financial Officer. We
also rely on senior management of our operating companies. While we have entered
into employment agreements with Messrs. Larkin and Azarela and certain senior
managers of the operating companies, we cannot be sure that such individuals
will remain with us throughout the terms of their agreements, or thereafter.
Further, we likely will depend on the senior management of any significant
businesses we acquire in the future. The loss of the services of one or more of
these key employees before we are able to attract and retain qualified
replacement personnel could have a material adverse effect on our business,
financial condition and results of operation.
PRINCIPAL STOCKHOLDERS HAVE SUBSTANTIAL INFLUENCE
As of October 20, 2000 our executive officers and directors controlled
approximately 14.6% of the combined outstanding voting power of all classes of
our common stock. As a result, with limited exception, such persons exert
substantial influence with respect to all matters submitted to a vote of holders
of common stock, including election of our directors.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the shares of
common stock offered by the selling stockholders under this prospectus but have
agreed to bear certain expenses associated with registering such shares under
Federal and state securities laws. We are registering the shares for sale to
provide the holders thereof with freely tradeable securities (subject in some
cases to the contractual limitations discussed below), but the registration of
such shares does not necessarily mean that any of such shares will be offered or
sold by the holders thereof.
SELLING STOCKHOLDERS
The following table sets forth, as of October 16, 2000:
- the names of the selling stockholders,
- the number of shares of common stock owned by each selling stockholder
prior to this offering, and
- the maximum number of shares of common stock offered by each selling
stockholder under this prospectus.
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All of the selling stockholders are, or at one time were, either executive
officers of our company or officers or stockholders of a predecessor of our
company. Other than that affiliation, no selling stockholder has any position,
office or other material relationship with the Company.
Because the selling stockholders may sell all, some or none of the common
stock offered under this prospectus, no estimate can be given as to the amount
of common stock that will be held by the selling stockholders upon termination
of the offering. See "Plan of Distribution."
<TABLE>
<CAPTION>
NUMBER OF SHARES
BENEFICIALLY OWNED MAXIMUM NUMBER OF
NAME OF SELLING STOCKHOLDER PRIOR TO THE OFFERING SHARES BEING OFFERED
--------------------------- --------------------- --------------------
<S> <C> <C>
William Troy Byler(1)(2)................................. 150,000 150,000
Henry D. Hoge(2)......................................... 361,368 361,368
Harold K. Spence(2)...................................... 158,623 158,623
Clarence S. Weber(2)..................................... 81,869 81,869
John H. Mansperger(2).................................... 68,225 68,225
Christopher W. Sorenson(2)............................... 15,351 15,351
Subramanian Janakiraman(2)............................... 10,233 10,233
John G. and Nancy S. Larkin.............................. 678,309 678,309
Michael R. Azarela....................................... 551,747 551,747
John Kennedy............................................. 404,021 404,021
Scott D. and Margaret G. Brace........................... 200,093 200,093
Harold C. Kropp, Jr...................................... 150,735 150,735
Gene J. Cellini.......................................... 40,651 40,651
John P. Nuzzo............................................ 40,651 40,651
John Polatz.............................................. 18,842 18,842
Christophe Julliard...................................... 7,489 7,489
Carla Jean Berkenkemper.................................. 5,000 5,000
--------- ---------
Total.......................................... 2,943,207 2,943,207
========= =========
</TABLE>
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(1) Number of shares beneficially owned by William Troy Byler are as of October
23, 2000.
(2) Under the agreement pursuant to which each selling stockholder acquired its
shares from us, such selling stockholder has agreed that it may sell its
shares pursuant to this prospectus only in accordance with the provisions of
that agreement. Under such agreement, each selling stockholder may sell up
to a specified number of shares in either a block trade or a registered
public offering, at our option. Such sale may be made only on a quarterly
basis as determined by us.
PLAN OF DISTRIBUTION
The sale of common stock by selling stockholders pursuant to this
prospectus may be effected from time to time in one or more transactions at a
fixed price or prices, which may be changed, at market prices prevailing at the
time of sale, at prices related to such prevailing market prices or at
negotiated prices.
The selling stockholders may from time to time offer and sell the shares
directly to purchasers or through agents, underwriters or dealers. Such sales
may be in the form of secondary distributions, exchange distributions, block
trades, ordinary brokerage transactions or a combination of such methods of
sale. Agents or underwriters acting on behalf of any selling stockholder may
receive compensation from the selling stockholder or from purchasers of the
common stock for whom they act as agent in the form of discounts, concessions or
commissions. Underwriters may sell the common stock to or through dealers, and
such dealers may receive compensation in the form of discounts, concessions or
commissions from the underwriters and/or commissions from the purchasers for
whom they may act as agents. Agents, underwriters and dealers that participate
in the distribution of common stock may be deemed to be underwriters for
purposes of the Securities Act of 1933, as amended, which we refer to as the
Act, and
9
<PAGE> 11
any discounts, concessions or commissions received by them from any selling
stockholder and any profit on the resale of common stock by them may be deemed
to be underwriting discounts and commissions under the Act.
At a time a particular offer of shares is made, a prospectus supplement, if
required, will be distributed that will set forth the names of any agents,
underwriters or dealers and any compensation from the selling stockholders and
any other required information.
In order to comply with the securities laws of certain states, if
applicable, the shares may be sold only through registered or licensed brokers
or dealers. In addition, in certain states, the shares may not be sold unless
they have been registered or qualified for sale in such state or an exemption
from such registration or qualification requirement is available and is complied
with.
We estimate that we will spend approximately $75,000 for expenses in
connection with the offering of shares by the selling stockholders.
Agents, underwriters or dealers may engage in transactions with or perform
services for us in the ordinary course of business.
VALIDITY OF COMMON STOCK
The validity of the common stock offered hereby will be passed upon for us
by King & Spalding.
EXPERTS
The financial statements incorporated by reference from the Annual Report
on Form 10-K in this prospectus and elsewhere in the registration statement have
been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their reports with respect thereto, and are included herein in
reliance upon the authority of said firm as experts in giving said reports.
10
<PAGE> 12
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
3,859,830 Shares
RAILWORKS CORPORATION
Common Stock
--------------------
PROSPECTUS
--------------------
November , 2000
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE> 13
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
<TABLE>
<S> <C>
SEC registration fee........................................ $ 2,588.25
Legal fees and expenses..................................... 50,000.00
Blue sky fees and expenses.................................. 5,000.00
Accounting fees and expenses................................ 10,000.00
Printing expenses........................................... 5,000.00
Miscellaneous............................................... 2,411.75
----------
Total............................................. $75,000.00
==========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 102(b)(7) of the Delaware General Corporation Law, which we refer
to as DGCL, permits a corporation, in its certificate of incorporation, to limit
or eliminate, subject to some statutory limitations, the liability of directors
to the corporation or its stockholders for monetary damages for breaches of
fiduciary duty, except for liability (a) for any breach of the director's duty
of loyalty to the corporation or its stockholders, (b) for acts or omissions not
in good faith or which involve intentional misconduct or a knowing violation of
law, (c) under Section 174 of the DGCL, or (d) for any transaction from which
the director derived an improper personal benefit. Article 10 of the
registrant's restated Certificate of Incorporation provides that the personal
liability of directors of the registrant is eliminated to the fullest extent
permitted by Section 102(b)(7) of the DGCL.
Under Section 145 of the DGCL, a corporation has the power to indemnify
directors and officers under certain prescribed circumstances and subject to
certain limitations against certain costs and expenses, including attorneys'
fees actually and reasonably incurred in connection with any action, suit or
proceeding, whether civil, criminal, administrative or investigative, to which
any of them is a party by reason of being a director or officer of the
corporation if it is determined that the director or officer acted in accordance
with the applicable standard of conduct set forth in such statutory provision.
Article 7 of the registrant's Bylaws provides that the registrant will 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 by reason of the
fact that he is or was a director, officer, employee or agent of the registrant,
or is or was serving at the request of the registrant as a director, officer,
employee or agent of another entity, against certain liabilities, costs and
expenses. Article 7 further permits the registrant to maintain insurance on
behalf of any person who is or was a director, officer, employee or agent of the
registrant, or is or was serving at the request of the registrant as a director,
officer, employee or agent of another entity, against any liability asserted
against such person and incurred by such person in any such capacity or arising
out of his status as such, whether or not the registrant would have the power to
indemnify such person against such liability under the DGCL. The registrant
expects to maintain directors' and officers' liability insurance.
The foregoing statements are subject to the detailed provisions of Article
10 of the registrant's restated Certificate of Incorporation.
II-1
<PAGE> 14
ITEM 16. EXHIBITS
<TABLE>
<C> <C> <S>
4.1 -- Restated Certificate of Incorporation of the Registrant
(incorporated by reference to Exhibit 3.1 to Registrant's
Registration Statement on Form S-1, File No. 333-53483).
4.2 -- By-Laws of the Registrant (incorporated by reference to
Exhibit 3.2 to the Registrant's Registration Statement on
Form S-1, File No. 333-53483).
4.3 -- Specimen Common Stock Certificate (incorporated by reference
to Exhibit 4.1 to Registration Statement on Form S-1, File
No. 333-53483).
5.1 -- Opinion of King & Spalding.
23.1 -- Consent of King & Spalding (included as part of its opinion
filed as Exhibit 5.1).
23.2 -- Consent of Arthur Andersen LLP.
</TABLE>
ITEM 17. UNDERTAKINGS
The undersigned registrant, which we refer to as the 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 the 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 20% 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 (i) and (ii) do not apply if the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by the Registrant pursuant to Section 13 of
Section 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.
The undersigned Registrant hereby further undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
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 provisions described under
II-2
<PAGE> 15
Item 15 above, or otherwise, the Registrant has been advised that in the opinion
of the Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act of 1933 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
policy as expressed in the Securities Act of 1933 and will be governed by the
final adjudication of such issue.
II-3
<PAGE> 16
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all 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 Baltimore, State of Maryland, on October 31, 2000.
RAILWORKS CORPORATION
By: /s/ JOHN G. LARKIN
------------------------------------
John G. Larkin
Chairman of the Board and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints John G. Larkin and Michael R. Azarela and each of
them, his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution for him and in his name, place and stead, in any
and all capacities, to sign any and all 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 attorneys-in-fact and agents full power and authority to do and
perform each and every act and thing requisite and necessary to be done in and
about the premises, as fully to all intents and purposes as he might or could do
in person, hereby ratifying and confirming all that each of said
attorneys-in-fact, or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities indicated on the 30th day of October 2000.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ JOHN G. LARKIN Chairman of the Board, Chief Executive Officer
--------------------------------------------------- and Director (Principal Executive Officer)
John G. Larkin
/s/ ED CUMBERLEDGE Senior Vice President -- Chief Financial Officer
--------------------------------------------------- (Principal Financial Officer)
Ed Cumberledge
/s/ HAROLD C. KROPP Vice President -- Chief Accounting Officer
--------------------------------------------------- (Principal Accounting Officer)
Harold C. Kropp
/s/ MIKE AZARELA Director
---------------------------------------------------
Mike Azarela
/s/ SCOTT D. BRACE Director
---------------------------------------------------
Scott D. Brace
/s/ RONALD W. DRUCKER Director
---------------------------------------------------
Ronald W. Drucker
</TABLE>
II-4
<PAGE> 17
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S>
/s/ JOHN KENNEDY Director
---------------------------------------------------
John Kennedy
/s/ R. C. MATNEY Director
---------------------------------------------------
R. C. Matney
/s/ DON TRAVISS Director
---------------------------------------------------
Don Traviss
</TABLE>
II-5
<PAGE> 18
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT SEQUENTIAL
NO. DESCRIPTION OF EXHIBITS PAGE NO.
------- ----------------------- ----------
<C> <S> <C> <C>
4.1 -- Restated Certificate of Incorporation of the Registrant
(incorporated by reference to Exhibit 3.1 to Registrant's
Registration Statement on Form S-1, File No. 333-53483).
4.2 -- By-Laws of the Registrant (incorporated by reference to
Exhibit 3.2 to the Registrant's Registration Statement on
Form S-1, File No. 333-53483).
4.3 -- Specimen Common Stock Certificate (incorporated by reference
to Exhibit 4.1 to Registration Statement on Form S-1, File
No. 333-53483).
5.1 -- Opinion of King & Spalding.
23.1 -- Consent of King & Spalding (included as part of its opinion
filed as Exhibit 5.1).
23.2 -- Consent of Arthur Andersen LLP.
</TABLE>
II-6
