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As filed with the Securities and Exchange Commission on March 30, 1998
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
Computer Horizons Corp.
(Exact name of registrant as specified in its charter)
Computer Horizons Corp.
49 Old Bloomfield Avenue
Mountain Lakes, New Jersey 07046-1495
New York (973) 299-4000
(State or Other Jurisdiction (Address, including ZIP code, and
of Incorporation or Organization) telephone number, including area code,
of registrant's principal executive offices)
13-2638902
(I.R.S. Employer
Identification Number)
John J. Cassese
Computer Horizons Corp.
49 Old Bloomfield Avenue
Mountain Lakes, New Jersey 07046-1495
(973) 299-4000
(Name, address, including ZIP code, and
telephone number, including area code,
of agent for service)
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Copies to:
Samuel L. Fishman, Esq.
LATHAM & WATKINS
885 Third Avenue
New York, New York 10022
(212) 906-1200
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Approximate date of commencement of proposed sale to the public:
From time to time after this Registration Statement becomes effective.
<PAGE>
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. [ ]
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
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Proposed Maximum Proposed Maximum
Title of each class of Securities Amount to be Offering Price Aggregate Amount of
to be Registered Registered Per Unit Offering Price Registration Fee
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<S> <C> <C> <C> <C>
Common Stock ($0.10 par value) 504,860 shares Not applicable $24,391,048.75(1) $7,195.36
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</TABLE>
(1) Estimated solely for the purpose of computing the amount of registration
fee, based on the average of the high and low prices for the Common Stock
as reported on The Nasdaq Stock Market on March 23, 1998, in accordance
with Rule 457(c) promulgated under the Securities Act of 1933.
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
soliciation of an offer to buy, nor shall there be any sale of these securities
in any State which such offer, soliciation or sale would be unlawful prior to
registration or qualification under the securities laws of any such State.
PROSPECTUS
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED MARCH 30, 1998
COMPUTER HORIZONS CORP.
504,860 Shares of Common Stock
($.10 Par Value Per Share)
This Prospectus relates to up to 504,860 shares (the "Shares") of common
stock, par value $.10 per share (the "Common Stock"), of Computer Horizons
Corp., a New York corporation (the "Company"), which may be offered for sale by
certain stockholders of the Company (the "Selling Stockholders"). Such sales may
be effected from time to time by the Selling Stockholders directly or through
one or more broker-dealers, in one or more transactions on The Nasdaq Stock
Market pursuant to and in accordance with the rules of such market, in the
over-the-counter market, in negotiated transactions or otherwise, at prices
related to the prevailing market prices or at negotiated prices. See "Plan of
Distribution."
The Company will not receive any of the proceeds from the sale of the
Shares. The Company will bear all expenses of the offering of the Shares, except
that the Selling Stockholders will pay any applicable underwriting fees,
discounts or commissions and transfer taxes, as well as the fees and
disbursements of counsel to and experts for the Selling Stockholders.
The Common Stock is listed on The Nasdaq Stock Market. On March 27, 1998
the last reported sale price for the Common Stock as reported on The Nasdaq
Stock Market was $50-1/8.
See "Risk Factors" commencing on page 3 for a discussion of certain
factors that should be considered by prospective purchasers of the Securities
offered hereby.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
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The date of this Prospectus is _____________, 1998.
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<PAGE>
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement on Form S-3 (including all amendments
thereto, the "Registration Statement") with respect to the securities offered
hereby. As permitted by the rules and regulations of the Commission, this
Prospectus does not contain all of the information set forth in the Registration
Statement and the exhibits and schedules thereto. For further information about
the Company and the securities offered hereby, reference is made to the
Registration Statement and the exhibits thereto, which may be examined without
charge at the public reference facilities maintained by the Commission at Room
1204, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and
copies of which may be obtained from the Commission upon payment of the
prescribed fees.
The Company is subject to the information requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Commission. The Registration Statement, the exhibits and schedules forming a
part thereof and the reports, proxy statements and other information filed by
the Company with the Commission in accordance with the Exchange Act can be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1204, Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661, and 7
World Trade Center, Suite 1300, New York, New York 10048. Copies of such
material can be obtained at prescribed rates from the Public Reference Section
of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. The
Commission maintains a web site that contains reports, proxy and information
statements and other information regarding registrants who file with the
Commission and certain of the Company's filings are available at such web site:
http://www.sec.gov. Additionally, the Common Stock is listed on The Nasdaq Stock
Market ("Nasdaq"). Reports, proxy information and other information concerning
the Company can be inspected at the offices of Nasdaq at 1735 K Street, N.W.,
Washington, D.C. 20006.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents filed by the Company under the Exchange Act with
the Commission are incorporated herein by reference.
(a) Annual Report on Form 10-K for the fiscal year ended December 31, 1997
(the "1997 10-K");
(b) The portions of the Company's 1997 Annual Report to Stockholders that
have been incorporated by reference into the 1997 10-K;
(c) The portions of the Company's Proxy Statement for its 1998 Annual
Meeting of Stockholders that have been incorporated by reference into
the 1997 10-K;
(d) Current Report on Form 8-K dated March 13, 1998;
(e) Current Report on Form 8-K/A dated March 17, 1998; and
(f) The description of the Common Stock contained in the Company's
Registration Statement on Form 8-A.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of the offering of the securities offered hereby shall be deemed to
be incorporated by reference in this Prospectus and to be a part hereof from the
date of filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of this Prospectus to the extent that a
statement contained herein or in any subsequently filed document which also is
or is deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Prospectus.
A copy of any or all of the documents incorporated or deemed to be
incorporated herein by reference (other than exhibits to such documents which
are not specifically incorporated by reference therein) will be provided without
charge to any person to whom a copy of this Prospectus is delivered, upon
written or oral request. Copies of this Prospectus, as amended or supplemented
from time to time, and any other documents (or parts of documents) that
constitute part of this Prospectus under Section 10(a) of the Securities Act of
1933, as amended (the "Securities Act"), will also be provided without charge to
each such person, upon written or oral request. Requests for such copies should
be addressed to the Vice President of Corporate Development of the Company, 49
Old Bloomfield Avenue, Mountain Lakes, New Jersey 07046 (telephone number: (973)
299-4000).
2
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FORWARD-LOOKING STATEMENTS
This Prospectus and the documents incorporated by reference herein contain
forward-looking statements that involve risks and uncertainties. The statements
contained in this Prospectus that are not purely historical are forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended,
including without limitation statements regarding the Company's expectations,
beliefs, intentions or strategies regarding the future. All forward-looking
statements included in this document are based on information available to the
Company on the date hereof, and the Company assumes no obligation to update any
such forward-looking statements. The Company's actual results could differ
materially from those anticipated in these forward-looking statements. In
evaluating the Company's business, prospective investors should consider
carefully the factors set forth herein under the heading "Risk Factors" in
addition to the other information set forth in this Prospectus.
THE COMPANY
The Company is a diversified information technology services company that
provides information technology ("IT") staffing and solutions services,
including Year 2000 services, to major corporations.
Founded in 1969 as a provider of IT staffing resources, the Company has
expanded through internal growth and acquisitions to become a leading national
provider of IT staffing services. The Company also offers its clients various IT
solutions services, including application development, conversions/migrations,
legacy maintenance outsourcing, enterprise network management and knowledge
transfer and training. The Company's Year 2000 solution addresses all phases of
Year 2000 projects from assessment through full compliance and is based on its
proprietary Signature 2000 Toolset.
The Company markets its services primarily to Fortune 500 companies with
significant information technology budgets and recurring staffing or software
development needs. In 1997, the Company provided services to approximately 500
clients, including AT&T, Chase Manhattan Corporation, Citicorp, Dow Chemical
Company, Florida Power & Light Company, Ford Motor Company, International
Business Machines Corporation, MCI Communications Corporation, NYNEX Corporation
and Prudential Insurance Company of America. The Company has been successful in
generating repeat business from existing clients, with more than 90% of billings
(excluding billings of certain subsidiaries) in each of 1995, 1996 and 1997
having been generated from clients that were also clients during the prior year.
The Company believes that its ability to offer a broad range of staffing and
solutions services and its established relationships with many Fortune 500
companies provide it with significant advantages in the IT services market.
The principal executive offices of the Company are located at 49 Old
Bloomfield Avenue, Mountain Lakes, New Jersey 07046. The telephone number is
(973) 299-4000.
RISK FACTORS
Fluctuations in Quarterly Operating Results.
The Company's revenues and operating results are subject to significant
variation from quarter to quarter. Revenues are subject to fluctuation based
upon a number of factors, including the timing and number of client projects
commenced and completed during the quarter, delays incurred in connection with
projects, the Company's ability to retain key personnel, the ability of the
Company to develop, introduce and market new and enhanced services,
announcements by the Company or its competitors, the growth rate of the market
for IT staffing and solution services, including Year 2000 services, and general
economic conditions. Unanticipated termination of a project or the decision by a
client not to proceed to the stage of a project anticipated by the Company could
result in decreased revenues and lower employee utilization rates which could
have a material adverse effect on the Company's business, operating results and
financial condition. For example, in the second quarter of 1996, the Company
lost a contract with a major client which resulted in a decline in solutions
revenues and net income. There can be no assurance that the Company will not
experience a similar loss in the future. The principal factors affecting the
Company's gross margin are the level of salary and other compensation related
expenses necessary to attract and retain qualified technical personnel and the
mix of staffing versus solutions business during the quarter. Compensation
levels can be impacted by a variety of factors including competition for
highly-skilled employees and inflation. The Company's operating results are also
subject to fluctuation as a result of other factors including the accuracy of
estimates of fixed-price projects, employee utilization rates and extraordinary
events such as acquisitions or litigation. The Company's operating results may
also be affected in the future by the licensing of its Signature 2000 Toolset
which it has recently begun to offer to third parties. To date, the Company has
only licensed the software to two clients and there can be no assurance that it
will be successful in its future licensing activities. However, to the extent
the Company does license its software, the revenues from such licensing
activities may result in significant fluctuations in the Company's revenues and
operating results.
3
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The Company has from time to time disclosed bookings for its Year 2000
services business. These bookings include projects which the Company has been
advised that it has been awarded the business but which are not yet subject to
contractual arrangements as well as projects which are subject to fully executed
contracts. In addition, to the extent that the project is not being undertaken
on a fixed-price basis, bookings are based on the Company's estimate of billings
expected to result from such project. There can be no assurance that the amounts
included in bookings at any given time will result in revenues being recognized
in the time frame anticipated by the Company or at all. As a result, bookings
should not be relied upon as an indication of revenues in any future period.
Due to all of the foregoing factors, in some future quarter or quarters
the Company's operating results may be below the expectations of securities
analysts and investors. For example, in the second quarter of 1996, the Company
failed to meet the expectations of securities analysts as a result of the loss
of a contract with a major client. Failure of the Company to meet such
expectations would have a material adverse effect on the price of the Company's
Common Stock. See "-- Potential Volatility of Stock Price."
Recruitment and Retention of IT Professionals.
The Company's business is labor intensive and depends to a large extent on
its ability to attract, train, motivate and retain highly-skilled IT
professionals and project managers. The Company must continually identify and
recruit technical personnel for both its staffing and solutions businesses to
fill new positions and to replace employees who have left the Company. Qualified
IT professionals are in great demand worldwide and are likely to remain a
limited resource for the foreseeable future. In addition, the IT services
industry has experienced high employee turnover rates which have increased in
recent periods and the Company's experience has been consistent with such
trends. There can be no assurance that the Company will be successful in
attracting a sufficient number of highly-skilled employees in the future, or
that it will be successful in retaining existing and future employees and the
failure to do so could have a material adverse effect on the Company's business,
operating results and financial condition. In addition, to the extent that the
number of companies in the IT services industry increases and such companies
seek to expand their employee bases, the competition for skilled employees and
the compensation being offered to such employees is likely to increase. As a
result of the foregoing, the Company may in the future be required to incur
higher recruiting expenses and increase its compensation levels, either of which
could have a material adverse effect on its business, operating results and
financial condition.
Risks Associated with Year 2000 Business; Risks Associated with New Services.
The Company expects to derive a significant percentage of its solutions
revenues from Year 2000 services through at least 1999. There can be no
assurance that the Company will be successful in increasing its Year 2000
business or, to the extent that such business increases, that the Company will
be able to meet the demand for such services on a timely basis. Any failure of
the Company to increase such business or meet such demand could have a material
adverse effect on the Company's business, operating results and financial
condition. While a substantial majority of the Company's current solutions
bookings are for Year 2000 projects, the Company expects this demand to begin to
decrease as the implementation and testing of many Year 2000 conversion projects
is completed. Any such decrease, to the extent it is not offset by an increase
in the Company's other businesses, could have a material adverse effect on the
Company's business, operating results and financial condition. In addition, by
devoting significant resources during the next several years to its Year 2000
services business, the Company's ability to develop, introduce and market new
services could be adversely affected. The Company is seeking to leverage its
knowledge of clients' IT systems and applications obtained during Year 2000
projects into additional engagements involving other solutions services
including services not previously provided by the Company. The Company's ability
to successfully develop new services depends on a number of factors, including
its ability to identify and effectively integrate new services into the
Company's existing operating structure. The identification and offering of new
services in which the Company has little or no experience or expertise could
result in a significant diversion of management's attention and place
disproportionate demands on the Company's operational, administrative and
financial resources. There can be no assurance that the Company will be
successful in generating additional business from its Year 2000 clients for
other services or that the performance of any new service offerings will meet
management's expectations or provide the same gross margins as the Company's
existing operations.
Dependence on Staffing Business.
In the years ended December 31, 1996 and December 31, 1997, the Company's
staffing business accounted for approximately 75% and 67% of revenues,
respectively. As a result, the Company's future operating results depend in
large part on the continued growth and profitability of the Company's staffing
business. Any decline in, or failure of the Company's staffing business to grow
at anticipated rates, as a result of competition or otherwise, would have a
material adverse effect on the Company's business, operating results and
financial condition.
Concentration of Revenues; Dependence on Large Projects.
The Company has derived, and believes that it will continue to derive, a
significant portion of its revenues from a limited number of large clients. In
each of the years ended December 31, 1996 and December 31, 1997, the Company's
ten largest clients accounted for approximately 40% of its revenues. One
customer, AT&T, accounted for approximately 9% and 12% of revenues in the years
ended
4
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December 31, 1996 and December 31, 1997, respectively. The volume of work
performed for specific clients is likely to vary from year to year, and a major
client in one year may not use the Company's services in a subsequent year. For
example, in the second quarter of 1996, the Company lost a contract with a major
client which resulted in a decline in solutions revenues and net income. The
loss of any large client could have a material adverse effect on the Company's
business, operating results and financial condition.
Most of the Company's contracts are terminable by the client following
limited notice and without significant penalty. In addition, each stage of a
project represents a separate contractual commitment at the end of which the
client may elect not to proceed to the next stage of the project. There can be
no assurance that in the future one or more of the Company's major clients will
not terminate a contract, reduce the scope of a large project or elect not to
proceed to the stage of a project anticipated by the Company. The cancellation
or significant reduction in the scope of a large project could have a material
adverse effect on the Company's business, operating results and financial
condition.
Competition.
The markets for the Company's services are highly competitive. The Company
believes that the market for IT staffing services is highly fragmented and
regionalized. As a result, in addition to competing with larger providers of IT
staffing services such as Cap Gemini SA, Computer Task Group, Inc., Keane, Inc.
and Mastech Corporation, the Company also competes with a large number of
regional providers of staffing services. In addition, the Company competes for
staffing projects with the information systems groups of its prospective
clients. In its solutions business, including its Year 2000 services business,
the Company competes with consulting and system integration firms, including
Analysts International Corporation, Andersen Consulting, CIBER, Inc., Computer
Sciences Corporation, Electronic Data Systems Corp., Information Management
Resources, Inc., International Business Machines Corporation, Keane, Inc. and
the "Big Six" accounting firms. The Company also competes in the IT solutions
market with vendors of application software. In addition, there are relatively
low barriers to entry into the Company's markets and the Company has faced, and
expects to continue to face, additional competition from other established and
emerging companies. Increased competition may result in greater pricing pressure
which could have a material adverse effect on the Company's operating results.
The Company believes competition will continue to intensify as the market
for IT services continues to develop and competitors focus on additional service
offerings such as Year 2000 services and European Monetary Union ("EMU")
conversion services. There can be no assurance that other companies will not
develop services, products and marketing approaches that will be more successful
than those of the Company. Many of the Company's current and potential
competitors have significantly greater financial, technical, marketing and other
resources than the Company. As a result, they may be able to respond more
quickly to new or emerging technologies and changes in clients' requirements, or
to devote greater resources to the development, promotion, sale and support of
their services and products than the Company. In addition, current and potential
competitors may establish cooperative relationships among themselves or with
third parties to increase the ability of their services or products to address
the staffing and solutions needs of the Company's prospective clients.
Accordingly, it is possible that new competitors, alliances among competitors or
alliances between competitors and third parties may emerge and acquire
significant market share. If this were to occur, it could have a material
adverse effect on the Company's business, operating results and financial
condition.
The Company believes that the principal competitive factors in its market
include quality of services and deliverables, speed of development and
implementation, price, project management capability and technical and business
expertise. The Company believes that its ability to compete also depends in part
on a number of competitive factors outside its control, including the ability of
its competitors to hire, retain and motivate project managers and other IT
professional staff, the development by others of software that is competitive
with the Company's services and products and the extent of its competitors'
responsiveness to client needs. There can be no assurance that the Company can
maintain its competitive position against current and potential competitors or
that competitive pressures faced by the Company will not have a material adverse
effect on the Company's business, operating results and financial condition.
Risks of Technological Change and Evolving Industry Standards.
The IT services industry is characterized by rapid technological change,
changing client requirements and new service and product introductions. The
introduction of competitive IT solutions embodying new technologies and the
emergence of new industry standards may render the Company's existing IT
solutions or underlying technologies obsolete or unmarketable. As a result, the
Company will be dependent in large part upon its ability to develop new IT
solutions that address the increasingly sophisticated needs of its clients, keep
pace with new competitive service and product offerings and emerging industry
standards and achieve broad market acceptance. There can be no assurance that
the Company will be successful in developing and marketing new IT solutions that
respond to technological change, changing client requirements or evolving
industry standards, that the Company will not experience difficulties that could
delay or prevent the successful development, introduction and marketing of these
new IT solutions or that its IT solutions will adequately meet the requirements
of the marketplace and achieve market acceptance.
5
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Fixed-Price Contracts.
The Company offers certain of its services on a fixed-price rather than on
a time and materials or best efforts basis. Although the Company draws upon the
past experience of its project managers and senior technical personnel to
estimate the cost of performing fixed-price projects, the Company has a limited
history upon which to base such estimates. Since under the terms of such
contracts the Company bears the risk of cost overruns and inflation in
connection with these projects, the Company's failure to estimate accurately the
resources and time required for a project or its failure to complete its
contractual obligations within the time frame committed could have a material
adverse effect on the Company's operating results and financial condition. In
the past, the Company has been required to commit unanticipated additional
resources to complete certain projects, which negatively affected the Company's
profitability on such projects and there can be no assurance that the Company
will not experience similar situations in the future.
Risks Associated with Failure to Manage Growth and a Changing Business.
The Company has recently experienced a period of significant growth that
has placed, and could continue to place, a significant strain on its management
and operations. From December 1996 to December 1997, the number of the Company's
billable consultants has increased from approximately 2,600 to 3,100 full-time
employees and independent contractors, and further increases are expected during
1998. The Company has also expanded geographically by opening new offices and it
intends to open additional offices which will require that the Company
successfully replicate its current business model in remote locations. In
addition, the Company is seeking to further expand its solutions business,
including its Year 2000 services business. The Company's ability to manage
future growth, if any, will require the Company to continually enhance its
operational and financial control systems, implement new systems as necessary,
and will depend on its ability to attract, train, assimilate and retain
qualified personnel. The Company is in the process of identifying a new
accounting system which it began implementing in late 1997 in order to provide
it with the flexibility to address the variations in billing arrangements
required for its solutions business. Although the Company intends to run its
existing and new systems in parallel for some period of time, there can be no
assurance that the Company will not experience difficulties in the operation of
its new accounting system which could result in delays or disruptions in billing
its clients. Any significant delays or disruptions in the Company's billing
cycle could have a material adverse effect on the Company's operating results in
the affected period. The failure of the Company's management to respond
effectively to future growth, if any, and the changing nature of its business
could have a material adverse effect on the Company's business, operating
results and financial condition.
Risks Associated with Potential Acquisitions.
As part of the Company's strategy, it intends to pursue strategic
acquisitions. Such acquisitions could present significant challenges to the
Company's management. There is significant competition for acquisition
opportunities in the IT services industry which may make the completion of
acquisitions more difficult and expensive. In addition, some competitors for
these acquisition candidates have greater resources than the Company. If the
Company is successful in completing acquisitions, it will face numerous risks,
including difficulties assimilating new operations and personnel, the need to
manage geographically remote businesses and the diversion of management
attention from other business concerns. Any acquisition, depending on its size,
could result in the use of a significant portion of the Company's cash, or if
such acquisition is made utilizing the Company's securities, could result in
significant dilution to the Company's shareholders. Furthermore, there can be no
assurance that any acquired service capacity or technology will gain acceptance
in the Company's markets. Should the Company's management fail to respond
effectively to these challenges, future acquisitions could have a material
adverse effect on the Company's business, operating results and financial
condition.
Dependence on Key Personnel.
The Company is dependent to a significant extent on the efforts, direction
and guidance of its senior management, including John J. Cassese, the Company's
Chairman of the Board, President and Chief Executive Officer, and other key
personnel. The Company has entered into employment agreements with its executive
officers, each of which contains provisions limiting these employees' rights to
compete with the Company and hire its employees. The Company maintains and is
the beneficiary under a key person life insurance policy in the amount of $3.8
million with respect to Mr. Cassese. The loss of any of the Company's senior
management or key personnel and, in particular, Mr. Cassese, or the inability to
attract and retain key management personnel in the future, could have a material
adverse effect on the Company's business, operating results and financial
condition.
Risks Associated with India Joint Venture.
The Company is seeking to leverage its relationship with Birla Horizons
International, an India-based joint venture between National Engineering
Industries Limited ("NEI"), an affiliate of The Birla Group, and the Company
(the "Joint Venture") to provide lower-cost, offshore solutions services to its
clients. The Board of Directors of the Joint Venture, consisting of an equal
number of representatives of the Company and NEI, controls and manages the
business of the Joint Venture. In the event of a deadlock among the Board of
Directors of the Joint Venture which is not resolved within 15 days, the Company
or NEI may terminate the Joint Venture by giving 30 days notice to the other
party. If the Joint Venture is terminated as a result of such a deadlock, the
non-terminating party will
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have the right to purchase the terminating party's shares in the Joint Venture
at fair market value for a period of 30 days. If the non-terminating party does
not purchase such shares during the 30 day period, the terminating party will be
entitled to sell its shares in the Joint Venture to a third party. There can be
no assurance that the Board of Directors of the Joint Venture will not become
deadlocked or that, as a result of such deadlock, the Company or NEI will not
have a right to terminate the Joint Venture. Any termination of the Joint
Venture, whether arising from a deadlock of the Board of Directors or otherwise,
could result in the loss of the Company's offshore outsourcing capabilities.
Such a loss could have a material adverse effect on the Company's business,
operating results and financial condition.
Since the Company does not directly oversee the services provided by the
Joint Venture, there can be no assurance that such services will be of the same
quality as the services provided by the Company. To the extent that there are
delays or problems with deliverables provided by the Joint Venture, the
Company's relationships with its clients may be adversely affected and the
Company may be required to incur expenses to remedy any problems that arise as a
consequence, either of which could have a material adverse effect on the
Company's business, operating results and financial condition. The Company
encountered problems of this nature in connection with an early project
involving the Joint Venture's resources. Furthermore, the Company must maintain
active satellite communications between its offices and the Joint Venture's
offices in order to effectively leverage its relationship with the Joint
Venture. Any disruption of the Company's ability to transmit voice and data
through satellite communications to India over a prolonged period of time could
have a material adverse effect on the Company's business, operating results and
financial condition.
In addition, the Joint Venture is subject to the risks associated with
doing business in India. India's central and state governments are significantly
involved in the Indian economy as regulators. In the recent past, the government
of India has provided significant tax incentives and relaxed certain regulatory
restrictions in order to encourage foreign investment in certain sectors of the
economy. Certain of these benefits that directly affect the Joint Venture
include, among others, tax holidays, liberalized import and export duties and
preferential rules on foreign investment and repatriation. Changes in the
business or regulatory climate of India could have a material adverse effect on
the Joint Venture's business, operating results and financial condition. In
addition, India has experienced significant inflation, shortages of foreign
exchange and has been subject to civil unrest. Changes in inflation, interest
rates, taxation or other social, political, economic or diplomatic developments
affecting India in the future could have a material adverse effect on the
Company's business, operating results and financial condition.
Increasing Significance of Non-U.S. Operations and Risks Associated
with International Operations.
The Company anticipates that over the next several years it will increase
its investment in international operations and that an increasing percentage of
its revenues may be generated outside of the U.S. The Company's international
operations depend greatly upon business, immigration and technology transfer
laws in those countries, and upon the continued development of technology
infrastructure. As a result, the Company's business is subject to the risks
generally associated with non-U.S. operations including, unexpected changes in
regulatory environments, difficulties in managing international operations,
dependence on foreign partners, fluctuations in currency exchange rates, longer
accounts receivable payment cycles and greater difficulties in collecting
accounts receivable, potential foreign tax consequences, including the impact of
repatriation of earnings, tariffs and other trade barriers, political unrest and
changing conditions in countries in which the Company's services are provided or
facilities are located. If any such factors were to render the conduct of
business in a particular country undesirable or impracticable, there could be a
material adverse effect on the Company's business, operating results and
financial condition.
Risks Associated with IT Industry Trend Toward Preferred Vendor Relationships.
To reduce their need to manage a large number of IT service providers and
to obtain more favorable pricing, certain businesses are seeking to use a
limited number of "preferred vendors." The Company believes that this trend
toward preferred vendors will become increasingly common in the marketplace, may
result in pricing pressure and will decrease the number of available business
opportunities. The Company is aggressively pursuing preferred vendor contracts
in order to obtain new or additional business from large clients. However, there
can be no assurance that the Company will be awarded preferred vendor contracts,
and the Company's inability to win such contracts could have a material adverse
effect on the Company's business, operating results and financial condition. In
addition, while preferred vendor contracts often generate higher volumes, they
may result in lower gross margins. As a result, there can be no assurance that
the Company will be able to maintain its gross margin if it is awarded preferred
vendor contracts. The Company's inability to sustain its gross margins on such
contracts could have a material adverse effect on the Company's business,
operating results and financial condition.
Risk of Increased Government Regulation of Immigration.
The Company and the Joint Venture in the past have relied and in the
future expect to rely increasingly upon attracting and retaining individuals
with technical and project management skills from other countries. There is a
limit to the number of new H-1B petitions that the Immigration and
Nationalization Service may approve in any government fiscal year, and in years,
such as 1997, in which the limit is reached, the Company may be unable to obtain
H-1B visas necessary to bring critical foreign employees to the U.S. Compliance
7
<PAGE>
with existing U.S. immigration laws, or changes in such laws making it more
difficult to hire foreign nationals or limiting the ability of the Company to
retain H-1B employees in the U.S., could increase competition for technical
personnel and increase the Company's cost of recruiting and retaining the
requisite number of IT professionals which could have a material adverse effect
on the Company's business, operating results and financial condition.
Risks Related to Intellectual Property Protection.
While the Company to date has not received any claims that its
intellectual property rights infringe on the intellectual property rights of
others, there can be no assurance that such a claim will not be asserted against
the Company in the future, that the assertion of such a claim will not result in
litigation or that the Company would prevail in such litigation or be able to
obtain a license for the use of any infringed intellectual property from a third
party on commercially reasonable terms. The risk of infringement claims against
the Company will increase if other parties are able to successfully obtain
patents for software products and processes related to the Company's business.
Any such claims, regardless of their outcome, could result in substantial cost
to the Company, require the Company to modify the manner in which it provides
services and divert management's attention from the Company's operations, any of
which could have a material adverse effect on the Company's business, operating
results and financial condition.
Potential Liability to Clients.
Much of the Company's business involves projects that are critical to the
operations of its clients' businesses and provide benefits that may be difficult
to quantify. Any failure in a client's system could result in a claim for
substantial damages against the Company, regardless of the Company's
responsibility for such failure. While the Company attempts to contractually
limit its liability for damages arising from its IT services, there can be no
assurance the limitations of liability set forth in its service contracts will
be enforceable in all instances or would otherwise protect the Company from
liability for damages. While the Company currently maintains general liability
insurance, including coverage for errors and omissions, there can be no
assurance that the Company will avoid significant claims and attendant
publicity. Furthermore, there can be no assurance that the Company's insurance
coverage will be adequate or that such coverage will remain available at
acceptable costs. Successful claims brought against the Company in excess of its
insurance coverage could have a material adverse effect on the Company's
business, operating results and financial condition.
Employment Liability Risks.
As a provider of staffing services, the Company places employees (and
independent contractors) at its clients' businesses. Risks associated with this
activity include possible claims of discrimination and harassment, liabilities
for errors and omissions by the Company's employees (and independent
contractors), misuse of client proprietary information or intellectual property,
injury to Company or client employees, misappropriation of client property,
other criminal activity, torts and other similar claims. In certain
circumstances, the Company may be held responsible for the actions of persons
not under the Company's direct control. While the Company has not had
significant problems with respect to such employment liability, there can be no
assurance that the Company will not experience such problems in the future.
Potential Volatility of Stock Price.
The trading price of the Company's Common Stock has been subject to
significant fluctuations in the past. In addition, the stock market has from
time to time experienced extreme price and volume fluctuations, particularly
among technology companies, which often have been unrelated to the operating
performance of particular companies. Any announcement with respect to any
unfavorable variance in revenues or net income from levels generally expected by
securities analysts or investors for a given period would have an immediate and
significant effect on the trading price of the Common Stock. In addition,
factors such as announcements of technological innovations or new services or
products by the Company, its competitors or other third parties, rumors of such
innovations or new services or products, changing market conditions in the IT
services industry, changes in estimates by securities analysts, announcements of
extraordinary events, such as acquisitions or litigation, or general economic
conditions may have a significant impact on the market price of the Common
Stock. In the past, following periods of volatility in the market price of a
particular company's securities, securities class action litigation has often
been brought against such companies. There can be no assurance that such
litigation will not occur in the future with respect to the Company. Such
litigation could result in substantial costs and a significant diversion of
management's attention and resources, which could have a material adverse effect
upon the Company's business, operating results and financial condition.
8
<PAGE>
Anti-Takeover Provisions.
The Company's Board of Directors has the authority to issue up to 150,000
shares of preferred stock (the "Preferred Stock") and to determine the rights,
preferences, privileges and restrictions, including voting and conversion rights
of such shares, without any further vote or action by the shareholders. The
issuance of Preferred Stock could have the effect of making it more difficult
for a third party to acquire a majority of the outstanding voting stock of the
Company. The Company has no present plan to issue Preferred Stock. The Company
is also subject to the anti-takeover provisions of Section 912 of the New York
Business Corporation Law, which will prohibit the Company from engaging in a
"business combination" with an "interested shareholder" for a period of five
years after the date of the transaction in which the person became an interested
shareholder, unless the business combination is approved in a prescribed manner.
The application of Section 912 could have the effect of delaying or preventing a
change in control of the Company. In addition, the Company has adopted a
shareholder rights plan or "poison pill" which would have certain anti-takeover
effects. The distribution of the Preferred Stock Purchase Rights, under the
terms of the Rights Agreement dated July 9, 1989, as amended, would cause
substantial dilution to a person or group that attempts to acquire the Company
on terms not approved by the Board of Directors of the Company. Furthermore, the
Company's option plans also provide for acceleration upon certain events
resulting in changes of control. Each of the foregoing provisions could delay or
make more difficult a merger, tender offer or proxy contest involving the
Company. There can be no assurance that such provisions will not have an adverse
effect on the value received by the holders of the Company's Common Stock.
9
<PAGE>
THE SELLING STOCKHOLDERS
The Shares to be offered under this Prospectus are owned by the Selling
Stockholders listed in the table below. All of the Selling Stockholders other
than Mr. DiVenuta acquired the Shares in connection with the merger of P.S.
Merger Corp. ("Sub"), a New Jersey corporation and a wholly-owned subsidiary of
the Company, with and into Princeton Softech, Inc., ("Princeton"), a New Jersey
corporation, pursuant to the terms of an Agreement and Plan of Merger dated as
of February 4, 1998, among the Company, Sub, Princeton and the stockholders of
Princeton of (the "Merger Agreement"). Pursuant to the terms of the Merger
Agreement, the Company agreed to file a registration statement covering the
Shares held by such Selling Stockholders with the Commission. Mr. DiVenuta, Vice
President of Corporate Development and General Counsel of the Company since May
30, 1996, will acquire the Shares to be sold by him upon exercise of a warrant
issued to him in connection with the commencement of his employment.
None of the Selling Stockholders holds shares of Common Stock in an amount
exceeding one percent of the total number of issued and outstanding shares of
Common Stock. Because the Selling Stockholders may sell all or some portion of
the Shares covered by this Prospectus, no estimate can be given as to the number
of Shares, or the percentage of outstanding shares of Common Stock, that will be
held by any of them after any particular sale.
The following table identifies each Selling Stockholder and sets forth
information as of March 30, 1998 with respect to the Shares held and to be
offered under this Prospectus from time to time by each Selling Stockholder.
Selling Stockholder Number of Shares
------------------- ----------------
Joseph A. Allegra 116,103
Susan R. Byxbee 350
Don Cohen 45,715
Lisa Cohen 291
Michelle L. Cosner 98
David Craig 34,875
Jose de Sousa 98
Joseph DiMarcantonio 728
Dennis M. DiVenuta 27,750
Sharon A. DiStase 175
Peter B. Fein 107
Bruce D. Haislip 74,980
David Hoeschele 39,322
David A. Kanof 582
Richard L. Kauffman 728
Deborah Kebler 33,858
Melissa H. McGarrigle 146
Richard McLaughlin 292
Susan L. Nadelson 728
Arif Padaria 98
Richard J. Parente 42,722
Richard D. Specht 62,194
Christopher J. Sweer 631
Elaine Verna 22,282
Amanda T. Wright 7
10
<PAGE>
PLAN OF DISTRIBUTION
The Shares are being sold by the Selling Stockholders for their own
account, and the Company will not receive any of the proceeds from the sale of
the Shares.
The distribution of the Shares by the Selling Stockholders may be effected
from time to time by the Selling Stockholders directly or through one or more
brokers, agents, or dealers in one or more transactions (which may involve
crosses and block transactions) on Nasdaq, other exchanges on which the Common
Stock is listed, pursuant to and in accordance with the rules of such exchanges,
in the over-the-counter market, in negotiated transactions or otherwise, at
prices related to prevailing market prices or at negotiated prices. In the event
that one or more brokers, agents or dealers agree to sell the Shares, they may
do so by purchasing Shares as principals or by selling the Shares as agents for
the Selling Stockholders. Any such brokers, agents or dealers who effect a sale
of the Shares may be deemed to be "underwriters" within the meaning of the
Securities Act. Any such broker, agent or dealer (i) may receive compensation
from the Selling Stockholders which may be deemed to be underwriting discounts
or commissions and (ii) may receive commissions from purchasers of the Shares
for whom it may act as agent. If any such broker or dealer purchases the Shares
as principal it may effect resales of the Shares from time to time to or through
other brokers or dealers, and such other brokers or dealers may receive
compensation in the form of concessions or commissions from the Selling
Stockholders or purchaser of the Shares for whom they may act as agents.
The Company has advised each of the Selling Stockholders that each of them
and any such brokers, dealers or agents who effect a sale of the Shares are
subject to the prospectus delivery requirements under the Securities Act. The
Company also has advised each of the Selling Stockholders that in the event of a
"distribution" of its Shares, each such Selling Stockholder and any broker,
agent or dealer who participates in such distribution may be subject to
applicable provisions of the Exchange Act and the rules and regulations
thereunder, including without limitation Regulation M.
In connection with distributions of the Shares, the Selling Stockholders
may enter into hedging transactions with broker-dealers, and the broker-dealers
may engage in short sales of the Common Stock in the course of hedging the
positions they assume with the Selling Stockholders. The Selling Stockholders
also may sell the Common Stock short and deliver the Shares to close out such
short positions. The Selling Stockholders also may enter into option or other
transactions with broker-dealers that involve the delivery of the Shares to the
broker-dealers, who may then resell or otherwise transfer such Shares. The
Selling Stockholders also may loan or pledge the Shares to a broker-dealer and
the broker-dealer may sell the Shares so loaned or upon a default may sell or
otherwise transfer the pledged Shares.
The Company will bear all expenses of the offering of the Shares, except
that the Selling Stockholders will pay any applicable underwriting fees,
discounts or commissions and transfer taxes, as well as the fees and
disbursements of counsel to and experts for the Selling Stockholders. The
Company has agreed to indemnify the Selling Stockholders and certain other
persons who sell Shares pursuant to this Prospectus against certain civil
liabilities, including liabilities under the Securities Act.
LEGAL MATTERS
The legality of the Shares offered hereby will be passed upon for the
Company by Latham & Watkins, New York, New York.
EXPERTS
The consolidated financial statements and schedule of Computer Horizons
Corp. and subsidiaries as of December 31, 1996 and December 31, 1997 and for
each of the years in the three-year period ended December 31, 1997 have been
incorporated by reference herein and in the registration statement in reliance
upon the reports of Grant Thornton LLP, independent certified public
accountants, incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing.
11
<PAGE>
================================================================================
No dealer, sales person or any other person has been authorized to give any
information or to make any representations not contained or incorporated by
reference in this Prospectus in connection with the offering herein contained,
and, if given or made, such information or representations must not be relied
upon as having been authorized by the Company or the Selling Stockholder. This
Prospectus does not constitute an offer to sell, or a solicitation of an offer
to buy, the securities offered hereby in any jurisdiction where, or to any
person to whom, it is unlawful to make such offer or solicitation. Neither the
delivery of this Prospectus nor any sale made hereafter shall, under any
circumstances, create any implications that the information contained herein is
correct as of any date subsequent to the date hereof.
------------------------------------
TABLE OF CONTENTS
Page
----
Available Information .................................... 2
Incorporation of Certain
Information by Reference ............................... 2
Forward-Looking Statements ............................... 3
The Company .............................................. 3
Risk Factors ............................................. 3
The Selling Stockholders ................................. 10
Plan of Distribution ..................................... 11
Legal Matters ............................................ 11
Experts .................................................. 11
------------------------------------
================================================================================
<PAGE>
================================================================================
504,860 SHARES
COMPUTER HORIZONS CORP.
COMMON STOCK
- --------------------------------------------------------------------------------
P R O S P E C T U S
- --------------------------------------------------------------------------------
_______________, 1998
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The expenses relating to the registration of the Shares will be borne by
the Company. Such expenses are set forth in the table below. All amounts are
estimates except the Securities Act registration fee.
Securities Act Registration Fee .................. $ 7,195.36
Accounting Fees and Expenses ..................... 17,000.00
Legal Fees and Expenses (other than Blue Sky) .... 15,000.00
Blue Sky Fees and Expenses ....................... 5,000.00
Miscellaneous .................................... 1,000.00
----------
Total ............................................ $45,195.36
==========
Item 15. Indemnification of Directors and Officers.
The Company's Certificate of Incorporation, as amended (the "Certificate
of Incorporation") provides, as permitted by Section 402(b) of the New York
Business Corporation Law (the "BCL") that no director shall be personally liable
to the Company or any shareholder for damages for any breach of duty as a
director, provided that the Certificate of Incorporation does not eliminate or
limit the liability of any director if a judgment or other final adjudication
adverse to him establishes that (i) his acts or omissions were in bad faith or
involved intentional misconduct or a knowing violation of law, (ii) he
personally gained in fact a financial profit or other advantage to which he was
not legally entitled or (iii) his acts violated Section 719 of the BCL.
The Certificate of Incorporation also provides, in accordance with Section
722 of the BCL, that each person who was or is made a party or is threatened to
be made a party to or is involved in any action, suit or proceeding, whether
civil, criminal, administrative or investigative (hereinafter a "proceeding"),
by reason of the fact that he, or a person of whom he is the legal
representative, (1) is or was a director or officer of the Company or (2) is or
was serving at the request of the Company as a director, officer, employee or
agent of another corporation or of a partnership, joint venture, trust or other
enterprise, including service with respect to employee benefit plans (whether
the basis of such proceeding is alleged action in an official capacity as a
director, officer, employee or agent or in any other capacity while serving as a
director, officer, employee or agent), shall be indemnified and held harmless by
the Company to the fullest extent authorized or permitted by applicable law, as
the same exists or may hereafter be amended (but, in the case of any such
amendment, only to the extent that such amendment permits the Company to provide
broader indemnification rights than said law permitted the Company to provide
prior to such amendment), against all expense, liability and loss (including
attorneys' fees, judgements, fines, ERISA excise taxes or penalties and amounts
paid or to be paid in settlement) actually and reasonably incurred or suffered
by such person in connection therewith and such indemnification shall continue
as to a person who has ceased to be a director, officer, employee or agent and
shall inure to the benefit of his heirs, executors and administrators, provided,
however, that, except for actions brought to enforce such indemnification
rights, the Company shall indemnify any such person seeking indemnification in
connection with a proceeding (or part thereof) initiated by such person only if
such proceeding (or part thereof) was authorized by the Board of Directors of
the Company. The right to indemnification conferred in the Certificate of
Incorporation is a contract right and includes the rights to be paid by the
Company the expenses incurred in defending any such proceeding in advance of its
final disposition, provided, however, that, if the BCL requires, the payment of
such expenses incurred by a director or officer in his capacity as such (and not
in any other capacity in which service was or is rendered by such person while a
director or officer, including, without limitation, service with respect to an
employee benefit plan) in advance of the final disposition of a proceeding,
shall be made only upon delivery to the Company of an undertaking by or on
behalf of such director or officer to repay all amounts so advanced as to which
it shall ultimately be determined that such director or officer is not entitled
to be indemnified.
The Certificate of Incorporation further provides, in accordance with the
BCL, that the indemnification rights provided therein are not exclusive of any
other rights that any person may have, and that the Company may, subject to
certain restrictions imposed by the BCL, maintain insurance to protect itself
and its officers and directors against expenses, liabilities and losses, whether
or not the Company would be permitted to indemnify such person against such
expenses, liabilities and losses under the BCL.
The Company currently has a $5,000,000 directors' and officers' liability
insurance policy.
II - 1
<PAGE>
Item 16. Exhibits
The following documents are filed as part of or incorporated by reference
in this Registration Statement.
<TABLE>
<CAPTION>
Exhibit Description Incorporated by Reference to
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
4(a) Rights Agreement dated as of July 6, 1989 between Exhibit 1 to registration Statement on form
the Company and Chemical bank, as Rights Agent 8-A dated July 7, 1989.
("Rights Agreement") which includes the form of rights
Certificate as Exhibit B.
4(b) Amendment No. 1 dated as of February 13, 1990 to Exhibit 1 to Amendment No. 1 on Form 8
Rights Agreement. dated February 13, 1990 to Registration
Statement on Form 8-A.
4(c) Amendment No. 2 dated as of August 10, 1994 to Exhibit 4(c) to Form 10K for the fiscal year
Rights Agreement. ended December 31, 1994.
4(d) Employee's Savings Plan and Amendment Number One. Exhibit 4.4 to Registration Statement on
Form S-8 dated December 5, 1995.
4(e) Employee's Savings Plan Trust Agreement as Amended Exhibit 4.5 to Registration Statement on
and Restated Effective January 1, 1996. Form S-8 dated December 5, 1995.
5(a) Opinion of Latham & Watkins. Filed herewith.
23(a) Consent of Latham & Watkins Filed herewith.
(included in its opinion filed as Exhibit 5.1)
23(b) Consent of Grant Thornton LLP Filed herewith.
24 Power of Attorney (included on page II-4 of this Filed herewith.
Registration Statement).
</TABLE>
Item 17. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or 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;
(iii) To include any material information with respect to the plan of
distribution not previously discussed in the registration statement
or any material change to such information in the registration
statement.
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed with or furnished to
the Commission by the registrant pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under the Securities Act
of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration, by means of a post-effective amendment, any of
the securities being registered which remain unsold at the termination of
the offering.
(b) 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.
II - 2
<PAGE>
(c) 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 Securities and
Exchange Commission such indemnification is against public policy as
expressed in the Act, and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment
by the registrant of expenses incurred or paid by a director, officer, or
controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered
hereunder, 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 Act and will be governed by the
final adjudication of such issue.
II - 3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all 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, on the 27th day of March, 1998.
COMPUTER HORIZONS CORP.
By: /s/ John J. Cassese
-------------------
John J. Cassese
Chairman of the Board and President
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below does hereby constitute and appoint John J. Cassese, William J.
Murphy and Dennis DiVenuta, and each of them, with full power of substitution
and full power to act without the other, his true and lawful attorney-in-fact
and agent to act for him in his name, place and stead, in any and all
capacities, to sign any or all amendments (including post-effective amendments)
to this Registration Statement on Form S-3, or any Registration Statement for
the same offering that is to be effective upon filing pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with all exhibits
thereto, and other documents in connection therewith or in connection with the
registration of the Common Stock under the Securities Exchange Act of 1934, as
amended, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, 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 in order to effectuate the same as fully, to all intents
and purposes, as they or he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, 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 and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
/s/ John J. Cassese
- -------------------
John J. Cassese Chairman of the Board and President March 27, 1998
(Principal Executive Officer) and Director
/s/ William J. Murphy
- ---------------------
William J. Murphy Executive Vice President, and Chief Financial Officer March 27, 1998
and Director (Principal Financial Officer)
/s/ Michael J. Shea
- -------------------
Michael J. Shea Vice President (Principal Accounting Officer) March 27, 1998
/s/ Thomas J. Berry
- -------------------
Thomas J. Berry Director March 27, 1998
/s/ Rocco J. Morano
- -------------------
Rocco J. Morano Director March 27, 1998
</TABLE>
II - 4
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT INDEX
Exhibit Description Incorporated by Reference to
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
4(a) Rights Agreement dated as of July 6, 1989 between Exhibit 1 to registration Statement on form
the Company and Chemical bank, as Rights Agent 8-A dated July 7, 1989.
("Rights Agreement") which includes the form of rights
Certificate as Exhibit B.
4(b) Amendment No. 1 dated as of February 13, 1990 to Exhibit 1 to Amendment No. 1 on Form 8
Rights Agreement. dated February 13, 1990 to Registration
Statement on Form 8-A.
4(c) Amendment No. 2 dated as of August 10, 1994 to Exhibit 4(c) to Form 10K for the fiscal year
Rights Agreement. ended December 31, 1994.
4(d) Employee's Savings Plan and Amendment Number One. Exhibit 4.4 to Registration Statement on
Form S-8 dated December 5, 1995.
4(e) Employee's Savings Plan Trust Agreement as Amended Exhibit 4.5 to Registration Statement on
and Restated Effective January 1, 1996. Form S-8 dated December 5, 1995.
5(a) Opinion of Latham & Watkins. Filed herewith.
23(a) Consent of Latham & Watkins Filed herewith.
(included in its opinion filed as Exhibit 5.1)
23(b) Consent of Grant Thornton LLP Filed herewith.
24 Power of Attorney (included on page II-4 of this Filed herewith.
Registration Statement).
</TABLE>
LATHAM & WATKINS
Attorneys At Law
53rd AT THIRD, SUITE 1000
885 THIRD AVENUE
NEW YORK, NEW YORK 10022-4802
TELEPHONE (212) 906-1200
FAX (212) 751-4864
--------------
March 30, 1998
Computer Horizons Corp.
49 Old Bloomfield Avenue
Mountain Lakes, New Jersey 07046-1495
Re: Registration Statement on Form S-3
Computer Horizons Corp.
Ladies and Gentlemen:
In connection with the registration of shares of common stock,
par value $0.10 per share (the "Shares"), of Computer Horizons Corp., a New York
corporation (the "Company"), under the Securities Act of 1933, as amended (the
"Act"), by the Company on Form S-3 filed with the Securities and Exchange
Commission (the "Commission") on March 30, 1998 (the "Registration Statement"),
you have requested our opinion with respect to the matters set forth below.
In our capacity as your counsel in connection with such
registration, we are familiar with the proceedings taken and proposed to be
taken by the Company in connection with the authorization, issuance and sale of
the Shares, and for the purposes of this opinion, have assumed such proceedings
will be timely completed in the manner presently proposed. In addition, we have
made such legal and factual examinations and inquiries, including an examination
of originals or copies certified or otherwise identified to our satisfaction of
such documents, corporate records and instruments, as we have deemed necessary
or appropriate for purposes of this opinion.
In our examination, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals, and
the conformity to authentic original documents of all documents submitted to us
as copies.
We are opining herein as to the effect on the subject
transaction only of the internal laws of the State of New York, and we express
no opinion with respect to the applicability thereto, or the effect thereon, of
the laws of any other jurisdiction or as to any matters of municipal law or the
laws of any local agencies within any state.
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LATHAM & WATKINS
Computer Horizons Corp.
March 30, 1998
Page 2
Subject to the foregoing, it is our opinion that the Shares
have been duly authorized and are validly issued, fully paid and nonassessable.
We consent to your filing this opinion as an exhibit to the
Registration Statement and to the reference to our firm contained under the
heading "Legal Matters."
Very truly yours,
/s/Latham & Watkins
EXHIBIT 23 (b)
CONSENT OF INDEPENDENT CERTIFIED ACCOUNTANTS
We have issued our report dated January 29, 1998 (except for Note 2, as to which
the date is February 27, 1998), accompanying the consolidated financial
statements incorporated by reference in the Annual Report of Computer Horizons
Corp. on Form 10-K for the year ended December 31, 1997, and our report dated
January 29, 1998, (except for Note 2, as to which the date is February 27, 1998)
accompanying the financial statement schedule included in that Form 10-K, which
are incorporated by reference in this Registration Statement. We consent to the
incorporation by reference in the Registration Statement of the aforementioned
reports and to the use of our name as it appears under the caption "Experts."
/s/Grant Thornton LLP
GRANT THORNTON LLP
Parsippany, New Jersey
March 26, 1998
