Prospectus
2,414,093 Shares of Common Stock
286,361 Shares of Series One Convertible Preferred Stock
1,205,556 Warrants
PAGE AMERICA GROUP, INC.
This Prospectus relates to the offer and sale from time
to time (the "Offering") of the following
securities of Page America Group, Inc. ("Page America" or the
"Company") by certain security holders of the
Company (the "Selling Security Holders"): 2,414,093 shares of
Common Stock (the "Common Stock");
286,361 shares of Series One Convertible Preferred Stock (the
"Series One Preferred Stock"); warrants to
purchase 1,205,556 shares of Common Stock (the "2003 Warrants");
and shares of Common Stock issuable
upon conversion of the Series One Preferred Stock (the
"Conversion Shares") or exercise of the 2003
Warrants and certain other warrants not being offered under this
Prospectus (the "Other Warrants")
(collectively, the "Securities"). Substantially all the
Securities were acquired by the Selling Security Holders
in connection with the Company's acquisition of substantially
all the radio paging assets and business of
CRICO Communications Corporation (the "CRICO Acquisition") and
the private financing thereof, all of
which occurred in 1993.
All the Securities offered hereby are being sold by the
Selling Security Holders. The Company
will not receive any proceeds from sales of the Securities by
the Selling Security Holders. The Company has
agreed to bear all expenses (other than selling expenses) in
connection with the registration of the Securities
and to indemnify the Selling Security Holders against certain
liabilities including liabilities under the
Securities Act of 1933.
The Selling Security Holders have advised Page America
that sales of the Securities may be
made from time to time by or for the account of the Selling
Security Holders in ordinary transactions to or
through one or more brokers or dealers in the American Stock
Exchange or the over-the-counter market or
otherwise at prices and on terms then prevailing or at prices
related to the then current market price, or in
negotiated transactions. In connection with such sales, the
Selling Security Holders and any brokers
participating in such sales may be deemed to be "underwriters"
as defined in the Securities Act of 1933, as
amended. See "Securities Covered By This Prospectus and Plan of
Distribution." There can be no
assurance that any of the Securities will be sold by the Selling
Security Holders.
THE SECURITIES OFFERED HEREBY INVOLVE A SIGNIFICANT DEGREE OF
RISK. SEE "INVESTMENT CONSIDERATIONS."
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is June 8, 1995.
<PAGE>
AVAILABLE INFORMATION
Page America is subject to the informational requirements
of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and in accordance therewith Page America files
reports, proxy statements and other information with the
Securities and Exchange
Commission (the "Commission"). Such
reports, proxy statements and other information can be inspected
and copied at the public reference
facilities maintained by the Commission at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549, and
the Regional Offices of the Commission at Suite 1400, Northwest
Atrium Center, 500 West Madison Street,
Chicago, Illinois 60661; and 7 World Trade Center, 13th Floor,
New York, New York 10048. Copies of such
material can also be obtained from the Public Reference Section
of the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549 at prescribed rates. Such reports,
proxy statements and other information
concerning the Company can also be inspected at the offices of
the American Stock Exchange, 86 Trinity
Place, New York, New York 10006, on which exchange the Company's
Common Stock is listed.
ADDITIONAL INFORMATION
Page America has filed with the Commission a Registration
Statement on Form S-2 (the
"Registration Statement") with respect to the Securities offered
hereby. This Prospectus does not contain all
the information set forth in the Registration Statement, certain
portions of which are omitted in accordance
with the rules and regulations of the Commission. For further
information with respect to Page America
and the Securities offered hereby, reference is made to the
Registration Statement and the exhibits filed
therewith. The omitted information may be obtained from the
Commission's principal office in Washington,
D.C., upon payment of the fees prescribed by the Commission.
Any statements contained herein concerning
the provisions of any document are not necessarily complete,
and, in each instance, reference is made to the
copy of such document filed as an exhibit to the Registration
Statement or otherwise filed with the
Commission. Each such statement is qualified in its entirety by
such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following document which has been filed by Page
America with the Commission pursuant
to the Exchange Act is incorporated by reference in this
Prospectus and shall be deemed to be a part
hereof:
1. Annual Report on Form 10-K for the year ended
December 31, 1994, as amended by Form 10-K/A and Form 10-K/A-1.
2. Quarterly Report on form 10-Q for the quarter ended
March 31, 1995.
Any statement contained in a document incorporated by
reference shall be deemed to be modified or superseded for all
purposes to the extent that a statement contained in this
Prospectus modifies or supersedes such statement. The Company
is delivering with this Prospectus a copy of its Annual Report
on Form 10-K for the year ended December 31, 1994.
Page America will provide without charge to any person to
whom this Prospectus is delivered,
on the written or oral request of any such person, a copy of any
or all documents incorporated herein by
reference. Such requests, in writing or by telephone, should be
directed to Ofelia Roman, Shareholder
Relations, Page America Group, Inc., 125 State Street,
Hackensack, New Jersey 07601. Page America's
telephone number is (201) 342-6676.
No person or dealer, salesperson or other individual is
authorized to give any information or
to make any representation not contained in this Prospectus
about the Company, the offering made hereby
or any other matter and, if given or made, such information or
representation must not be relied upon as
having been authorized by the Company. This Prospectus does not
constitute an offer to sell or a
solicitation of an offer to buy the Securities offered hereby to
any person or by anyone in any jurisdiction
in which it is unlawful to make such offer or solicitation.
Neither the delivery of this Prospectus nor any
sale of the Securities offered hereby shall, under any
circumstances, create any implication that the
information contained herein is correct as of any date
subsequent to the date hereof.
THE COMPANY
Page America provides paging, messaging and information
products and services in the New
York and Chicago metropolitan area markets and in Southeastern
Florida and Northern California through
networks which it owns and operates as a radio common carrier
("RCC") under licenses from the Federal
Communications Commission ("FCC"). As of December 31, 1994, the
Company provided paging services through 20 offices
in ten states to approximately 311,000 pagers
in geographic areas encompassing a total population of 38
million people.
The Company's strategy is to concentrate its operations
in major metropolitan markets in which
it can achieve both critical mass and a substantial market share
position, allowing it to maximize growth.
The Company targets specific user segments and, through its
broad distribution capabilities, markets and
delivers its comprehensive package of paging and value-added
messaging services to each particular segment.
The Company has secured licenses for multiple channels in each
of its markets and has developed, and
continues to develop, networks which can support significant
future growth in paging units as well as value-
added messaging and information services. The Company
emphasizes
customer ownership of pagers, as
compared to leasing of pagers, which significantly reduces the
Company's capital costs. At March 1, 1995,
approximately 69 percent of the Company's units in service were
customer owned.
The number of pagers served by the Company has increased
over 385 percent since April 1,
1989, from 64,000 to 311,000 pagers at December 31, 1994. The
Company's total revenues have increased
from $10.3 million in fiscal year 1989 to $37.3 million in
fiscal year 1994. In February 1995, the Company
entered into an agreement to sell to Paging Network of Florida,
Inc. its California and Florida
paging assets for a cash purchase price of
$22,370,000, subject to certain adjustments. Completion of this
transaction is subject to the satisfaction of
conditions normally contained in these types of transactions,
including FCC approval.
Page America was incorporated in 1976 under the laws of
the State of New York. The
Company's principal executive offices are located at 125 State
Street, Hackensack, New Jersey 07601, and its
telephone number is (201) 342-6676. Unless the context
indicates otherwise, the terms "Company" and "Page
America" as used herein refer to Page America Group, Inc. and
its subsidiaries.
INVESTMENT CONSIDERATIONS
Prospective investors should carefully consider the
following factors, as well as the other
information contained in this Prospectus.
1. History of Losses; Accumulated Deficit. Since its
inception, the Company has not been
profitable. For the fiscal year ended December 31, 1994, the
Company incurred a net loss of $7 million.
There can be no assurance that the Company will be profitable in
the future. As of December 31, 1994, the
Company had an accumulated deficit of $79 million.
2. Indebtedness, Liquidity and Access to Capital. In
connection with its growth, the Company
has incurred significant amounts of indebtedness. As of
December 31, 1994, the Company had long-term
debt of $58 million, including $45 million outstanding under a
senior secured credit facility (the "Credit
Facility") and $13 million principal amount outstanding under
subordinated promissory notes (the "Subordinated Notes").
3. Deficiency in Working Capital; Limitation on
Purchases of Pagers. Historically, the Company
has experienced a deficiency in its working capital. At
December 31, 1994, the Company had a working
capital deficiency of $9.5 million. In order to conserve
capital, pager purchases are limited by management
of the Company to an amount necessary to maintain its subscriber
base.
4. Effect of Competition and Technological Advances.
The Company faces competition in the
geographic areas in which it operates. Some of the Company's
competitors possess greater financial and
other resources than the Company. In addition, technological
advances in the telecommunications industry
may result in the availability of alternative services or
products that could compete with the paging services
currently provided by the Company and its competitors. There
can be no assurance that the Company
would not be adversely affected in the event of such
technological change.
5. Governmental Regulation of the Company's Operations.
The Company's paging operations are subject to regulation by the
FCC and various state regulatory agencies. There can be no
assurance that either the FCC or state agencies will not adopt
regulations, authorize new competitive services or take other
actions that would materially adversely affect the results of
operations of the Company. Changes in
regulation of the Company's paging business or the allocation of
radio spectrum for services that compete
with the Company's business could adversely affect the Company's
future results of operations.
6. Rights of Holders of Preferred Stock to Elect
Directors; Change in Control Consequences.
Holders of a majority of Series One Preferred Stock, as a class,
have the right to elect two directors of the
Company. In addition, if any dividend payments are not made to
the holders of shares of Series One
Preferred Stock, the dividend rate will increase to 15% per
annum and the holders of a majority of Series
One Preferred Stock will be entitled to elect an additional
director of the Company. If a change in control
of the Company occurs, the holders of Series One Preferred Stock
have the right to cause the Company to
repurchase such stock at its liquidation value, plus accrued
dividends. Bariston Paging Partners, L.P. holds a
majority of the Series One Preferred Stock. See "Description of
Capital Stock and Warrants."
7. Restrictions on Payment of Dividends; Liquidation
Preferences. The Company has never paid
cash dividends on its Common Stock and does not intend to pay
cash dividends on its Common Stock in the
foreseeable future. The Company may not pay any cash dividends
on Common Stock while accrued
dividends on its outstanding Preferred Stock remain unpaid. In
addition, the Company is restricted in its
ability to pay dividends on both its Common Stock and Preferred
Stock under the Credit Facility and the
Subordinated Notes. Series One Preferred Stock has a preference
over the Common Stock in the event of a
liquidation of the Company. See "Description of Capital Stock
and Warrants."
8. Loss of Chief Executive Officer. The Company's
success depends upon its ability to attract
and retain skilled managers and key personnel, including its
Chairman of the Board and Chief Executive
Officer, Steven L. Sinn. Loss of the services of Mr. Sinn might
have an adverse effect on the operation of
the Company. The Company does not have an employment agreement
with Mr. Sinn nor does the Company maintain any key-man life
insurance on Mr. Sinn.
9. No Prior Public Market. Prior to this Offering,
there has been no public market for the
Series One Preferred Stock or the 2003 Warrants and there is no
assurance that an active public market will
develop or if developed that it will continue. In the absence
of an active public trading market, an investor
may be unable to liquidate his investment.
EARNINGS/(LOSS) TO COMBINED FIXED CHARGES AND PREFERRED STOCK
DIVIDENDS
Earnings are inadequate to cover combined fixed charges
and preferred stock dividends.
Additional earnings of $5,576,000, $5,557,000, $8,480,000,
$9,812,000 and $10,051,000 for the year ended
March 31, 1991, the nine months ended December 31, 1991 and the
years ended December 31, 1992, 1993
and 1994, respectively, would be needed to cover the earnings
deficiency.
USE OF PROCEEDS
The Company will not receive any proceeds from sales of
the Securities by the Selling Security
Holders and will bear all expenses of the Offering. If any of
the Other Warrants or 2003 Warrants are
exercised, the proceeds received from such exercise will become
part of the Company's working capital.
SECURITIES COVERED BY THIS PROSPECTUS AND PLAN OF DISTRIBUTION
All of the Securities being offered hereby are owned by
certain security holders of the Company
(the "Selling Security Holders"). The Securities may be offered
for sale by the Selling Security Holders from
time to time in transactions (which may include block
transactions) in the American Stock Exchange or the
over-the-counter market, in negotiated transactions, or a
combination of such methods of sale, at fixed 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 Security
Holders may effect such transactions by selling
to or through broker-dealers, and such broker-dealers may
receive compensation in the form of discounts,
concessions or commissions from the Selling Security Holders
and/or the purchasers of such securities for
whom such broker-dealers may act as agent or to whom they sell
as principal or both. The Company has
agreed to indemnify the Selling Security Holders against certain
liabilities, including liabilities under the
Securities Act of 1933. See "Selling Security Holders."
Each share of Series One Preferred Stock is convertible
into 22.22 shares of Common Stock.
Each 2003 Warrant is immediately exercisable and represents the
right to purchase one share of Common
Stock at a purchase price of $3.50 per share until December 31,
2003. The exercise price of the 2003
Warrants and the number of shares of Common Stock issuable upon
the conversion or exercise of each
share of Series One Preferred Stock and 2003 Warrants are
subject to anti-dilution adjustment in the case of
stock dividends, stock splits, mergers, acquisitions,
recapitalizations, issuances of stock below the exercise or
conversion price and similar events. See "Description of
Capital Stock and Warrants."
When acquiring the Securities, these Selling Security
Holders represented that they were
acquiring their Securities for investment and not for
distribution thereof in violation of the Securities Act,
and agreed that they would not sell, transfer or otherwise
dispose of their Securities except under certain
conditions including a distribution or sale pursuant to a
registration statement declared effective by the
Securities and Exchange Commission. See "Selling Security
Holders."
<TABLE>
<CAPTION>
SELLING SECURITY HOLDERS
The following table sets forth information as of April 15, 1995
with respect to the Selling Security Holders for whose accounts
shares of Common Stock, Series One Preferred Stock and Warrants
are being offered pursuant to this Prospectus. All fractional
shares of Common Stock issuable upon conversion of the Series
One Preferred Stock have been rounded down and will be paid in cash
upon conversion.
Ownership After Sale
Series One Assuming Owners Were
Convertible Common Stock Common Stock to Elect to Sell All
Name of Selling Common Stock Warrents Preferred Issuable Upon Issuable Upon Such Shares and
Security Holder Number of Number of Number of Exercise of Conversion of Warrants Offered
Shares Offered Warrants Offered Shares Offered Warrants Preferred Stock Hereby
Number of Percent
Shares Owned Owned
<S> <C> <C> <C> <C> <C> <C> <C>
Rebecca G. Ames Trust 189 4,199 0 0
Arent, Fox, Kinter
Plotkin & Kohn 52,000 0 0
BHI Associates VI,
L.P. (4) 125,963(1) 0(1) 0(1)
Bariston Paging
Partners, L.P.(4) 156,242 3,471,697 0 0
Bariston Associates(4) 2,254 41,733(1) 50,083 0(1) 0(1)
David Barry, IRA(4) 378 8,399 0 0
Coleman Benedict 628 13,954 0 0
Howard R. Berlin 626 13,909 0 0
Bergman Horowitz &
Reynolds, PC 312 6,932 0 0
Murray B. Berry 1,271 28,241 0 0
James J. Burke 1,271 28,241 0 0
Randall W. Byrnes 942 20,931 0 0
Norma J. Cowen IRA 313 6,954 0 0
Stephen and Lois Coit 315 6,999 0 0
Clarion Capital 5,000 111,100 0 0
CRI, Inc. 86,667(3) 0 0
Gary B. Davis 2,542 56,483 0 0
Delaware State
Employee Retirement
Fund 5,000 111,100 0 0
Stewart R. Dudley 313 6,954 0 0
Martin M. Ehrlich 313 6,954 0 0
Family Ventures V,
L.P. 953 21,175 0 0
First Bank National
Association 364,165 0 0
John L. Gardner, Jr.
Trust 189 4,199 0 0
Joseph E. Gibbs 1,271 28,241 0 0
Carl Giffin 317 7,043 0 0
Daljit K. Gill, M.D. 314 6,977 0 0
Peter L. Goedecke 314 6,977 0 0
Griffith R. Harsh, III 314 6,977 0 0
David M. Helpern 1,261 28,019 0 0
Walter R. Hess 468 10,398 0 0
Lee H. Idleman 626 13,909 0 0
Julian & Eunice Cohen
Investment, L.P. 1,261 28,019 0 0
Lawrence and Suellen
Kadis 502 11,154 0 0
Michael Kadis IRA 1,339 29,752 0 0
Kenneth M. Kahn 125 2,777 0 0
Richard I. Karash 250 5,555 0 0
Michael M. Kassen 942 20,931 0 0
Charles W. Kemp, Jr. 946 21,020 0 0
Robert Ladd 250 5,555 0 0
Marine Midland Bank,
N.A. 487,968 0 0
Motorola, Inc. 243,408 0 0
John V. McManmon 187 4,155 0 0
Hobart A. McWhorter,
Jr. 635 14,109 0 0
Mirza Mehdl 1,256 27,908 0 0
Martin E. Messinger 1,251 27,797 0 0
Kenneth Musen 313 6,954 0 0
MHF Fund I 153,100 0 0
Theodore A. Oatis 313 6,954 0 0
Daniel P. Paduano 625 13,887 0 0
Premier Venture
Capital Corporation 14,167(2) 4,640 102,212 0 0
Foley, Revy Investment
Co., Inc.
Account: First
Interstate Bank
of Oregon as
Agent for Oregon
Equity Fund 20,000 444,400 0 0
Roger T. Servison 942 20,931 0 0
Barbara I. Shook 2,542 56,483 0 0
Michael Simmons 803 17,842 0 0
William M. Spencer,
III 1,271 28,241 3,750 *
Eleanor Moore Sterne 628 13,954 0 0
Sandler Mezzanine
Foreign Partners, L.P.(5) 57,422 2,590 57,422 57,549 0 0
Sandler Mezzanine
Partners, L.P.(5) 267,200 12,020 267,200 267,084 0 0
Sandler Mezzanine
T-E Partners, L.P.(5) 119,823 5,390 119,823 119,765 0 0
Martin C. Schwartzberg 43,333(3) 0 0
T. Rowe Price High
Yield Fund, Inc. 500,000 711,111 20,000 711,111 444,400 0 0
T. Rowe Price
Strategic Partners
Fund, L.P. 160,428(2) 15,200 5,642 15,200 125,365 0 0
T. Rowe Price
Strategic Partners
Fund II, L.P. 367,295(2) 34,800 12,918 34,800 287,037 0 0
Union Bank 224,662 0 0
Alicia H. Urban 312 6,932 0 0
Mark J. Waltch 1,271 28,241 0 0
Stephen R. Weiner 1,261 28,019 0 0
______________
* Less than 1%.
(1) Consists of shares issuable upon exercise of warrants
previously issued to the holders at an exercise price of $5.03
per share.
(2) Includes shares of Common Stock issued to the holders in
connection with the sale of Series B Preferred Stock and/or
Subordinated Notes in 1992.
(3) Consists of shares issuable upon exercise of warrants
acquired in connection with the CRICO Acquisition at an exercise
price of $5.00 per share.
(4) David A. Barry is a director of the Company elected by the
holders of the Company's Series One Convertible Preferred Stock.
Mr. Barry and Jack Kadis are the general partners of BHI
Associates VI, L.P., which is the sole general partner of
Bariston Paging Partners, L.P. ("Bariston Paging"). Messrs.
Barry and Kadis are the controlling shareholders of Bariston
Holdings, Inc., which is the sole shareholder of Bariston
Associates, Inc. ("Bariston"). Bariston, Bariston Paging and
Messrs. Barry and Kadis are Selling Shareholders.
Bariston has been engaged by the Company to provide
investment banking functions for which it receives an annual fee
of $105,000, subject to cost of living adjustments. This
agreement will terminate upon the earlier to occur of Bariston
and its affiliates ceasing to control a majority of the Series
One Convertible Preferred Stock (or Common Stock issued upon
conversion thereof) or Bariston and its affiliates owning less
than 20 percent of the Company's fully diluted shares of Common
Stock. Bariston acted as a placement agent in connection with the 1993 financing related to the Crico acquisition for which it
received a fee of $532,500, plus reimbursement for its
out-of-pocket expenses. After consummation of the Crico
acquisition and the related financing, Bariston repaid to the
Company $421,000 of indebtedness owed to the Company by
surrendering to the Company for cancellation 4,210 shares of
Series One Convertible Preferred Stock which had a value of $100
per share.
(5) Sandler Mezzanine General Partnership is the investment
General Partner of each of Sandler Mezzanine T-E Partners, L.P.
("TE"), Sandler Mezzanine Partners, L.P. ("SM") and Sandler
Mezzanine Foreign Partners, L.P. ("FP"). Mr. Michael J.
Marocco, a director of the Company elected by the holders of
Series One Convertible Preferred Stock, is the President of MJM
Media Corp., the general partner of each of TE, SM and FP. TE,
SM and FP are Selling Shareholders.
</TABLE>
All of the Securities (except as described in the footnotes
to the above chart) covered by this
Prospectus are being offered by or for the account of the
persons who acquired them in connection with the
CRICO Acquisition and financing thereof. The Securities being
offered hereby are, to the best of the
Company's knowledge, still owned by the Selling Security
Holders. The Company has agreed to prepare and
file a registration statement registering the resale of the
Securities offered hereby by the Selling Security
Holders and to use its best reasonable efforts to have such
registration statement declared effective and to
maintain a current prospectus with respect to such Securities
until December 31, 1996.
Certain of the Selling Security Holders, their associates
and affiliates may from time to time be
customers of, engage in transactions with, and/or perform
services for, the Company in the ordinary business.
The Selling Security Holders may be deemed to be
underwriters under the Securities Act of 1933.
DESCRIPTION OF CAPITAL STOCK AND WARRANTS
Common Stock
The Company is authorized to issue up to 100,000,000 shares
of Common Stock, par value $.10 per
share, of which at February 28, 1995, 7,593,764 shares of Common
Stock were issued and outstanding.
Subject to the rights of the holders of any series of Preferred
Stock, holders of the Common Stock of the
Company are entitled to share equally on a per share basis in
such dividends as may be declared by the
Board of Directors out of funds legally available therefor.
Upon liquidation, dissolution or winding-up of
the Company, after payment of creditors and the holders of any
senior securities of the Company, including
Preferred Stock, the assets of the Company will be divided pro
rata on a per share basis among the holders
of the shares of Common Stock. The Common Stock is not subject
to any liability for further assessments.
There are no conversion or redemption privileges nor any sinking
fund provisions with respect to the
Common Stock, and the Common Stock is not subject to call. The
holders of Common Stock do not have
any preemptive or other subscription rights.
Holders of Common Stock are entitled to cast one vote for
each share held at all shareholders'
meetings for all purposes, including the election of directors.
The Common Stock does not have cumulative voting rights.
Preferred Stock
The Company is authorized to issue up to 5,000,000 shares
of Preferred Stock, par value $.01 per
share. The Preferred Stock may be issued by the Company's Board
of Directors from time to time in one or
more series. The Board of Directors is authorized to determine
the rights, preferences, privileges and
restrictions, including the dividend rights, conversion rights,
voting rights, terms of redemption (including
sinking provisions, if any) and liquidation preferences of any
series of Preferred Stock and to fix the number
of shares of any such series without any further vote or action
by the shareholders. The Company currently
has outstanding 286,361 shares of Series One Preferred Stock.
The Company may not declare or pay any dividends on its
Common Stock or make, directly or
indirectly, any payment on the account of the redemption,
purchase or other acquisition of such stock unless
all cumulative dividends on the Company's outstanding Preferred
Stock shall have been paid in full.
Series One Preferred Stock
On December 30, 1993, the Company issued an aggregate of
305,768 shares of Series One Preferred
Stock, convertible into an aggregate of 6,794,164 shares of
Common Stock in connection with the financing
of the CRICO Acquisition. Holders of the Series One Preferred
Stock are entitled to vote the number of
votes that they would be entitled to vote if their shares of
Series One Preferred Stock were converted into
shares of Common Stock. Holders of a majority of the Series One
Preferred Stock, as a class, are entitled
to elect two representatives to the Board of Directors.
Each share of Series One Preferred Stock has a 10%
dividend, payable semi-annually in arrears, and
is convertible into Common Stock at an initial price of $4.50
per share (the "Series One Conversion Price"),
subject to certain anti-dilution provisions. Payment of
dividends may be made in cash or in Common Stock
of the Company registered under the Securities Act of 1933. Any
dividend payments not made will accrue
at the 10% annual rate. Any dividend payments not made when
permitted under the Credit Facility and the
Subordinated Notes will result in, among other things, an
increase in the dividend rate to 15% per annum
and entitle holders of a majority of Series One Preferred Stock
to elect an additional representative to the
Board of Directors of the Company. Upon conversion of Series
One Preferred Stock, the Company will
have the option to pay accrued dividends by issuing additional
shares of its Common Stock. Holders of the
Series One Preferred Stock will be entitled to a preference in
liquidation ahead of holders of the Common
Stock of $100 per share of Series One Preferred Stock plus any
accrued but unpaid dividends.
The Company may redeem the Series One Preferred Stock if
the average closing price of the
Common Stock for both the preceding 60 day and 5 day periods has
equalled or exceeded 150% of the
Series One Conversion Price. After December 31, 2000, the
Series One Preferred Stock may be redeemed
at par, plus accrued dividends. If the Company calls the Series
One Preferred Stock for redemption, holders
thereof will have a 30 day period to convert to shares of Common
Stock or have their shares of Series One
Preferred Stock redeemed. Upon any redemption, accrued
dividends must be paid by the Company in cash.
2003 Warrants
Also in connection with the financing of the CRICO
Acquisition, the Company issued an aggregate
of 1,205,556 2003 Warrants. Each of the 2003 Warrants offered
hereby is in registered form and entitles the
holder thereof to purchase, at any time and from time to time,
one share of Common Stock of the Company
at a price of $3.50 per share until December 31, 2003.
Thereafter, any 2003 Warrants which have not been
exercised will expire and be void. The Company may accelerate
the expiration of the Warrants at any time
after December 31, 1996, upon 30 days written notice (the
"Notice Date") to the holders thereof (the "2003
Warrantholders"), if the average closing price for shares of the
Common Stock for both the 60 day and the 5
day periods preceding the Notice Date was equal to or greater
than 150% of the 2003 Warrant Exercise
Price.
The 2003 Warrantholders will be entitled to anti-dilution
protection for stock splits and similar
events and weighted average anti-dilution protection (except for
shares issued in connection with acquisitions
and shareholder approved management stock plans). If a change
of control of the Company occurs at less
than a 25% premium over the exercise price, the 2003
Warrantholders will have the right to cause the
Company to pay to them the difference between the exercise price
and 125% of the exercise price; provided,
however, they must exercise the 2003 Warrants.
LEGAL OPINION
The validity of the Securities offered hereby will be
passed upon for Page America by Stroock &
Stroock & Lavan, Seven Hanover Square, New York, New York 10004.
Martin H. Neidell, a member of the
firm, is Secretary of Page America.
EXPERTS
The consolidated financial statements and the related
financial statement schedule of Page America
Group, Inc. appearing in Page America Group, Inc.'s Annual
Report (Form 10-K) for the year ended
December 31, 1994, have been audited by Ernst & Young LLP,
independent auditors, as set forth in their
report thereon included therein and incorporated herein by
reference. Such consolidated financial
statements and related financial statement schedule are
incorporated herein by reference in reliance upon
such report given upon the authority of such firm as experts in
accounting and auditing.
