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As filed with the Securities and Exchange Commission on November 6, 1997
Registration No. 33-68884
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------
POST-EFFECTIVE AMENDMENT NO. 2
TO
FORM S-1
REGISTRATION STATEMENT
ON FORM S-3
UNDER
THE SECURITIES ACT OF 1933
AMERICAN COUNTRY HOLDINGS INC.
(Exact name of registrant as specified in its charter)
Delaware 06-0995978
(State or other jurisdiction (I.R.S. Employer
incorporation or organization) Identification No.)
222 N. LaSalle Street
Chicago, Illinois 60601
(312) 456-2000
(Address, including zip code, and telephone number, including area
code, of Registrant's principal executive offices)
EDWIN W. ELDER III
President and Chief Executive Officer
American Country Holdings Inc.
222 N. LaSalle Street
Chicago, Illinois 60601
(312) 456-2000
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copy to:
SIDNEY TODRES, ESQ.
Epstein Becker & Green, P.C.
250 Park Avenue
New York, New York 10177
(212) 351-4735
Approximate date of proposed commencement of sale to the public: As soon
as practicable after this Registration Statement becomes effective.
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
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. [_]
---------------
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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<PAGE>
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED NOVEMBER 6, 1997
PROSPECTUS
AMERICAN COUNTRY HOLDINGS INC.
4,583,306 Shares of Common Stock
($.01 par value)
------------
The 4,583,306 shares of Common Stock to which this Prospectus relates (the
"Shares") are issuable by American Country Holdings Inc. (formerly The Western
Systems Corp. and hereinafter the "Company") at $1.83 per Share upon the
exercise of outstanding warrants. The number of Shares issuable and the per
Share exercise price give effect to the anti-dilution provisions of the
warrants. See "Description of Securities" and "Plan of Distribution."
The Common Stock is traded on The Nasdaq Stock Market's SmallCap Market
under the symbol "ACHI." On November 5, 1997, the closing price of the Common
Stock, as reported by The Nasdaq Stock Market, was $2.25 per share.
------------
See "Investment Considerations" for a discussion of certain factors that
should be considered by prospective purchasers of the Shares offered hereby.
------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
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 , 1997
<PAGE>
AVAILABLE INFORMATION
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
Securities and Exchange Commission (the "Commission"). Such material may be
inspected and copies made at the regional offices of the Commission at 7 World
Trade Center, Suite 1300, New York, New York 10048, and at Citicorp Center, 500
West Madison Street, Suite 1400, Chicago Illinois 60661-2511. This material may
also be inspected and copies made at and, upon written request copies obtained
at prescribed rates from, the Public Reference Section of the Commission at Room
1024 at its principal office, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549.
DOCUMENTS INCORPORATED BY REFERENCE
The Company's (i) Annual Report on Form 10-K for the fiscal year ended
December 31, 1996, (ii) Quarterly Reports on Form 10-Q for the periods ended
March 31, 1997 and June 30, 1997, (iii) Definitive Proxy Statement dated June
27, 1997 for its July 25, 1997 Special Meeting in lieu of the Annual Meeting of
Stockholders (the "Definitive Proxy Statement") and (iv) Current Reports on Form
8-K filed on July 31, 1997 (as amended on Form 8-K/A on August 11, 1997) and
August 14, 1997, heretofore filed with the Commission, are incorporated in and
made a constituent part of this Prospectus by reference. All reports and proxy
statements filed by the Company with the Commission pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act after the date of this Prospectus and
prior to termination of the offering of the Shares shall likewise be deemed
incorporated herein and made a constituent part hereof by reference from the
respective dates of filing.
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 that is also incorporated by reference
herein modifies or replaces such statement. Any statements so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
Upon oral or written request, the Company will provide without charge a
copy of any document incorporated in this Prospectus by reference, exclusive of
exhibits, to each person to whom this Prospectus is delivered. Requests for such
documents should be directed to the Chief Financial Officer of the Company, 222
N. LaSalle Street, Chicago, Illinois 60601 (telephone no.
312-456-2000).
2
<PAGE>
THE COMPANY
This Prospectus contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and
Section 21E of the Exchange Act which are not historical facts, and involve
risks and uncertainties that could cause actual results to differ materially
from those expected or projected. Such risks and uncertainties include, but are
not limited to, the factors set forth under the caption "Investment
Considerations" herein.
On July 29, 1997, the Company, through two newly-organized wholly-owned
subsidiaries acquired substantially all assets and assumed substantially all
liabilities of American Country Insurance Company ("American Country") and its
wholly-owned subsidiary, American Country Financial Services Corp., for cash of
$40,250,000 (the "Acquisition"), pursuant to an asset purchase agreement dated
April 30, 1997. Financing for the Acquisition was provided by the Company's cash
on hand of approximately $8,890,000, approximately $26,700,000 from the sale by
the Company of 24,001,029 shares of its Common Stock and the balance from a bank
under a revolving credit facility described below.
On July 29, 1997, the Company obtained a five-year, $7,000,000 revolving
loan credit facility from The First National Bank of Chicago, and on such date
borrowed $6,800,000 ($2,000,000 of which was repaid on such date) at an initial
interest rate of 81/2% per annum which was converted, at the Company's option,
on August 1, 1997 to an interest rate based upon Eurodollar rates, equal to an
interest rate of 71/2% per annum through December 1, 1997, payable quarterly.
The initial borrowing was to fund a portion of the $40,250,000 purchase price
for the Acquisition. The maximum $7,000,000 credit facility is required to be
reduced by $2,333,333 on July 29, 2000 and by an additional $2,333,333 by July
29, 2001.
Also on July 29, 1997, the Company issued 24,001,029 shares of its Common
Stock to three investors for an aggregate of approximately $26,700,000 to fund a
portion of the $40,250,000 purchase price for the Acquisition.
For financial reporting purposes, the Acquisition has been accounted for
as a reverse acquisition. Accordingly, financial statements for the Company for
the periods prior to July 29, 1997 will become those of American Country. The
historical financial statements of American Country included in the Definitive
Proxy Statement, which is incorporated herein and is a constituent part of this
Prospectus, will change as a result of the reverse acquisition as follows: (i)
Certain account balances within the historical statement of stockholders' equity
will be reclassified but the total amount of stockholders' equity will remain
unchanged, and (ii) the number of shares of common stock and common stock
equivalents outstanding will be restated and, accordingly, earnings per share
will be restated; however, net income will not change. The restated earnings per
share balances will be consistent with the pro forma earnings per share
information included in the Definitive Proxy Statement.
American Country Insurance Company ("American Country") is a property and
casualty insurance company, domiciled in the State of Illinois, which
underwrites and markets commercial, specialty and personal lines of insurance.
Commercial lines, principally workers' compensation, multi-peril, and auto and
physical damage, accounted for approximately 47% of American Country's direct
premiums written in 1996, and the related policies were marketed, inter alia, to
artisan contractors and distributors, restaurants and transportation companies.
Specialty lines, principally liability and collision coverage for taxicabs and
limousine companies in the City of Chicago and surrounding suburbs, accounted
for approximately 39% of American Country's 1996 direct written premiums, and
personal lines, primarily auto and home owners' policies, accounted for the
balance. American Country Financial Services Corp. operates principally as a
premium finance company.
The Company was incorporated under the laws of the State of Delaware on May
30, 1978. The Company's executive offices are located at 222 N. LaSalle Street,
Chicago, Illinois 60601 (telephone no. (312) 456-2000).
3
<PAGE>
INVESTMENT CONSIDERATIONS
Prospective purchasers of the Shares offered hereby should carefully
consider the following investment considerations:
Regulation
American Country is subject to regulation and supervision by the insurance
commissioners of the States of Illinois, Indiana, Michigan and Wisconsin. Such
regulation generally is designed to protect policyholders rather than investors
and relates to such matters as the standards of solvency which must be met and
maintained; the licensing of insurers and their agents; the nature of and
examination of the affairs of insurance companies, which includes periodic
market conduct examinations by the regulatory authorities; annual and other
reports, prepared on a statutory accounting basis, required to be filed on the
financial condition of insurers or for other purposes; establishment and
maintenance of reserves for unearned premiums and losses; and requirements
regarding numerous other matters. American Country must file all rates for
insurance directly underwritten with the applicable state insurance departments.
Reinsurance generally is not subject to rate regulation. Further, state
insurance statutes place limitations on the amount of dividends or other
distributions payable by insurance companies in order to protect their solvency.
The National Association of Insurance Commissioners ("NAIC") has
established eleven financial ratios to assist state insurance department in
their oversight of the financial condition of insurance companies operating in
their respective states. The NAIC calculates these ratios based on information
submitted by insurers on an annual basis and shares the information with the
applicable state insurance departments. The ratios relate to leverage,
profitability, liquidity and loss reserve development.
In their ongoing effort to improve solvency regulation, the NAIC and
individual states have enacted certain laws and statutory-basis financial
statement reporting requirements. For example, NAIC rules require audited
statutory financial statements as well as actuarial certification of loss and
loss adjustment expense ("LAE") reserves therein. Other activities are focused
on greater disclosure of an insurer's reliance on reinsurance, changes in its
reinsurance programs and accounting for certain overdue reinsurance. In
addition, the NAIC has implemented risk-based capital requirements for property
and casualty insurance companies commencing in 1995 (see below). These
regulatory initiatives and the over all focus on solvency may intensify the
restructuring and consolidation of the insurance industry. It is also possible
that Congress may enact legislation regulating the insurance industry. While the
impact of these regulatory efforts on American Country's operations cannot be
quantified until enacted, American Country believes it will be adequately
positioned to compete in an environment of more stringent regulation.
In 1994, the NAIC implemented a risk-based capital measurement formula to
be applied, commencing in 1995, to all property/casualty insurance companies,
which formula calculates a minimum required statutory net worth based on the
underwriting, investment, credit loss reserve and other business risks
applicable to the insurance company's operations. An insurance company that does
not meet threshold risk-based capital measurement standards could be required to
reduce the scope of its operations and ultimately could become subject to
statutory receivership or other similar proceedings. As at December 31, 1996,
American Country exceeded the risk-based capital requirements.
Competition
The property and casualty insurance business is highly competitive,
principally in terms of price and extent of coverage. Many insurance carriers
are submitting applications for admission to the states in which American
Country markets its insurance coverage.
In response, American Country will continue to focus on marketing to
specialty niches including transportation, artisan contractors and upscale
restaurants, areas in which American Country's personnel have extensive
experience. American Country has the largest market share of property and
casualty insurance coverage for the taxicab market in the Chicago Metropolitan
area. Competitors for taxicab liability coverage in Chicago and the surrounding
area include Merit Insurance Company and Acceptance Insurance Company. American
Country competes with CNA Insurance Company, West Bend Insurance Company and
Fremont Insurance Company with respect to workers' compensation coverage.
4
<PAGE>
Adequacy of Loss Reserves
The liabilities for unpaid losses and loss adjustment expenses are
estimated by management utilizing methods and procedures which they believe are
reasonable. These liabilities are necessarily subject the impact of future
changes in claim severity and frequency, as well as numerous other factors.
Although management believes that the estimated liabilities for losses and loss
adjustment expenses are reasonable, because of the extended period of time over
which such losses are reported and settled, the subsequent development of these
liabilities may not conform to the assumptions inherent in their determination
and, accordingly, may vary significantly from the estimated amounts included in
the accompanying financial statements. To the extent that the actual emerging
loss experience varies from the assumptions used in the determination of these
liabilities, the liabilities are adjusted to reflect actual experience. Such
adjustments, to the extent they occur, are reported in the period recognized.
Ratings
Increased public and regulatory concerns with the financial stability of
insurers have resulted in greater emphasis by policyholders upon insurance
company ratings, with a resultant potential competitive advantage for carriers
with higher ratings. American Country currently is rated A- (Excellent) by A.M.
Best. In addition, S&P has given American Country an Insurer Claims-Paying
Ability Rating of BBBq (Adequate). There can be no assurance, however, that
American Country will maintain its ratings; any downgrade could materially
adversely affect its operations. A.M. Best's and S&P's ratings are based on an
analysis of the financial condition and operations of an insurance company as
they relate to the industry in general, are not designed for the protection of
investors and do not constitute recommendations to buy, sell or hold any
security.
Dependence on Management
The Company is dependent upon its executive management and upon its ability
to attract and retain qualified employees.
Fluctuations in Industry Results
The financial results of property and casualty insurers historically have
been subject to significant fluctuations. Profitability is affected
significantly by volatile and unpredictable developments (including
catastrophes), changes in loss reserves resulting from changing legal
environments as different types of claims arise and judicial interpretations
develop relating to the scope of insurers' liability, fluctuations in interest
rates and other changes in the investment environment which affect returns on
invested capital, and inflationary pressures that affect the size of losses.
Further, underwriting results have been cyclical in the property and casualty
insurance industry, with protracted periods of overcapacity adversely impacting
premium rates, resulting in higher combined ratios, followed by periods of
undercapacity and escalating premium rates, resulting in lower combined ratios.
Dependence on Investment Income
American Country, similar to other property and casualty insurance
companies, depends on income from its investment portfolio for a substantial
portion of its earnings. A significant decline in investment yields could have a
material adverse effect on American Country's financial results.
5
<PAGE>
DESCRIPTION OF SECURITIES
The Company is authorized to issue 60,000,000 shares of Common Stock, $.01
par value, and 2,000,000 shares of Preferred Stock, $.10 par value.
Common Stock
The holders of outstanding shares of Common Stock are entitled to share
ratably on a share-for-share basis with respect to any dividends when, as and if
declared by the Board of Directors out of funds legally available therefor. Each
holder of Common Stock is entitled to one vote for each share held of record.
The Common Stock is not entitled to conversion or preemptive rights and is not
subject to redemption. Upon liquidation, dissolution or winding up of the
Company, the holders of Common Stock are entitled to share ratably in the net
assets legally available for distribution. All outstanding shares of Common
Stock are fully paid and nonassessable.
Preferred Stock
The Preferred Stock may be issued from time to time without stockholder
approval in one or more classes or series, and the Board of Directors is
authorized to fix the dividend rights, dividend rates, any conversion rights or
rights of exchange, any voting rights, rights and terms or redemption (including
sinking fund provisions), the redemption price or prices, the liquidation
preferences and any other rights, preferences, privileges and restrictions of
any class or series of Preferred Stock, the number of shares constituting such
class or series and the designation thereof. The shares of any class or series
of Preferred Stock need not be identical. Depending upon the rights of such
Preferred Stock, the issuance of Preferred Stock could have an adverse effect on
holders of Common Stock by delaying or preventing a change in control of the
Company, making removal of the present management more difficult or resulting in
restrictions upon the payment of dividends and other distributions to the
holders of Common Stock. There are currently no shares of Preferred Stock
outstanding.
Warrants
Each Common Stock Purchase Warrant ("Warrant") entitles the registered
holder to purchase 2.19 shares of Common Stock at an exercise price of $1.83 per
share, subject to adjustment, at any time prior to the close of business on
December 31, 1997, subject to earlier redemption. The Warrants are redeemable by
the Company on 30 days' prior written notice at a redemption price of $1.00 per
Warrant provided the average of the closing bid prices of the Company's Common
Stock for 30 trading days exceeds $5.00 per share. All Warrants must be redeemed
if any are redeemed. Warrants that are not redeemed and are unexercised upon
expiration will be exchanged for shares of Common Stock in the ratio of one
share of Common Stock for 500 expired Warrants. Upon notice to the
Warrantholders, the Company has the right to reduce the exercise price or extend
the expiration date of the Warrants.
The exercise price of the Warrants and the number and kind of shares of
Common Stock or other securities and property issuable upon exercise of the
Warrants are subject to adjustment in certain circumstances, including a stock
split of, stock dividend on, or a subdivision, combination or capitalization of,
the Common Stock or the sale of Common Stock at less than the market price of
the Common Stock. The 2.19 shares of Common Stock issuable upon exercise of a
Warrant and the exercise price of $1.83 per Share give effect to an adjustment
resulting from the issuance by the Company of 24,001,029 shares of its Common
Stock for $26,700,000 in July 1997.
The Warrants have been issued pursuant to a warrant agreement between the
Company and American Stock Transfer & Trust Company, the warrant agent (the
"Warrant Agent"), and are evidenced by warrant certificates in registered form.
The Warrants do not confer upon the holder any voting or any other rights of a
shareholder of the Company.
The Warrants may be exercised upon surrender of the Warrant certificate
evidencing such Warrants on or prior to the respective expiration date (or
earlier redemption date) of such Warrants at the offices of the Warrant Agent
with the form of "Election to Purchase" on the reverse side of the Warrant
certificate completed and executed as indicated, accompanied by payment of the
full exercise price (by certified check payable to the order of the Warrant
Agent) for the number of Warrants being exercised.
Transfer Agent and Warrant Agent
American Stock Transfer & Trust Company, New York, New York, is the
transfer and warrant agent for the Common Stock and Warrants.
6
<PAGE>
PLAN OF DISTRIBUTION
The Shares are issuable by the Company at $1.83 per Share upon exercise of
the Warrants. See "Description of Securities."
LEGAL MATTERS
The validity of the Shares offered hereby have been passed upon for the
Company by Epstein Becker & Green, P.C., New York, New York.
EXPERTS
The financial statements incorporated in this Prospectus by reference from
the Company's Annual Report on Form 10-K for the year ended December 31, 1996
have been audited by Lazar, Levine & Company LLP, independent certified public
accountants, as stated in their report, which is incorporated herein by
reference, and has been so incorporated in reliance upon such report given upon
the authority of such firm as experts in accounting and auditing.
The consolidated financial statements of American Country at December 31,
1996 and 1995, and for each of the three years in the period ending December 31,
1996 appearing in the Company's definitive Proxy Statement dated June 27, 1997,
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 are incorporated herein by reference in
reliance upon such report given upon the authority of such firm as experts in
accounting and auditing.
7
<PAGE>
======================================== ======================================
No dealer, salesman, or any other
person has been authorized to give any
information or to make any
representations other than those
contained 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. This
Prospectus does not constitute an offer
to sell, or a solicitation of an offer
to buy, the securities offered hereby
in any jurisdiction to any person to
whom it is unlawful to make an offer or
solicitation. Neither the delivery of
this Prospectus nor any sale made
hereunder shall, under any
circumstances, create an implication
that there has been no change in the
facts herein set forth since the date
hereof.
--------------------- 4,583,306 Shares
of Common Stock
TABLE OF CONTENTS
AMERICAN COUNTRY HOLDINGS INC.
Page
----
Available Information .............. 2 ---------------------
Documents Incorporated PROSPECTUS
by Reference ..................... 2 ---------------------
The Company ........................ 3
Investment Considerations .......... 4
Description of Securities .......... 6
Plan of Distribution ............... 7
Legal Matters ...................... 7
Experts ............................ 7
, 1997
======================================== ======================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The estimated expenses of this offering, are as follows:
S.E.C. Registration Fee ....... $ 0
Accounting Fees ............... 3,750
Printing and Engraving ........ 1,000
Legal Fees and Expenses ....... 10,000
Miscellaneous ................. 250
-------
Total ....................... $15,000
=======
Item 15. Indemnification of Directors and Officers.
Section 145 of the Delaware General Corporation Law grants corporations the
power to indemnify their directors, officers, employees and agents in accordance
with the provisions thereof. Article EIGHTH of Registrant's Certificate of
Incorporation and Article VII, Section 7 of its By-Laws provide for
indemnification of Registrant's directors, officers, agents and employees to the
full extent permissible under Section 145 of the Delaware General Corporation
Law.
Item 16. Exhibits.
<TABLE>
<S> <C>
5 -- Opinion by Epstein Becker & Green, P.C.
23.1 -- Consent of Lazar, Levine & Company LLP.
23.2 -- Consent of Ernst & Young LLP.
23.3 -- Consent of Epstein Becker & Green, P.C. (included in Exhibit 5).
24 -- Power of Attorney (included as part of Signature Page).
</TABLE>
Item 17. Undertakings.
(a) The Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
i) to include any prospectus required by Section 10(a) (3) of the
Securities Act;
ii) to reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change in the
information set forth in the Registration Statement;
iii) to include any material information with respect to the plan
of distribution not previously disclosed in the Registration
Statement or any material change of such information in the
Registration Statement;
provided, however, that paragraphs (i) and (ii) above do not apply
if the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or 15(d) of the Exchange Act that are
incorporated by reference in the Registration Statement.
II-1
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed
to be a new Registration Statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions of its Certificate of Incorporation,
its By-Laws, the Delaware General Corporation Law, or otherwise, the
Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question of whether such indemnification by it is against
public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
II-2
<PAGE>
POWER OF ATTORNEY TO SIGN AMENDMENTS
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below does hereby constitute and appoint Martin L. Solomon and Edwin W. Elder,
and each of them, with full power to act without the other, his true and lawful
attorney-in-fact and agent for him and in his name, place and stead, in any and
all capacities, to sign any or all amendments to this Registration Statement and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, 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.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Chicago, State of Illinois, on the 3rd day of
November, 1997.
AMERICAN COUNTRY HOLDINGS INC.
By /s/ Edwin W. Elder
-----------------------------------------
Edwin W. Elder
Executive Vice President and
Chief Operating Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Martin L. Solomon President, Chairman of the November 3, 1997
- ----------------------- Board, Chief Executive Officer
Martin L. Solomon and Director (Principal Executive
Officer)
/s/ Edwin W. Elder Executive Vice President, Chief November 3, 1997
- ----------------------- Operating Officer and Director
Edwin W. Elder
/s/ James P. Byrne Treasurer, Chief Financial Officer November 3, 1997
- ----------------------- and Vice President (Principal
James P. Byrne Financial and Accounting
Officer)
/s/ William J. Barrett Director November 3, 1997
- -----------------------
William J. Barrett
/s/ Herbert M. Gardner Director November 3, 1997
- -----------------------
Herbert M. Gardner
II-3
<PAGE>
Signature Title Date
--------- ----- ----
/s/ Wilmer J. Thomas, Jr. Director November 3, 1997
- -------------------------
Wilmer J. Thomas, Jr.
/s/ Peter H. Foley Director November 3, 1997
- -------------------------
Peter H. Foley
II-4
<PAGE>
Exhibit Index
Page
----
5 -- Opinion by Epstein Becker & Green, P.C.
23.1 -- Consent of Lazar, Levine & Company LLP.
23.2 -- Consent of Ernst & Young LLP.
23.3 -- Consent of Epstein Becker & Green, P.C. (included in Exhibit 5).
24 -- Power of attorney (included as part of Signature Page).
II-5
EXHIBIT 5
EPSTEIN BECKER & GREEN, P.C.
250 Park Avenue
New York, New York 10177-0077
(212) 351-4735
November 4, 1997
The Board of Directors of
American Country Holdings Inc.
222 N. LaSalle Street
Chicago, Illinois 60601
Re: Post-Effective Amendment No. 2 to Form S-1
Registration Statement on Form S-3
(File No. 33-68884)
Gentlemen:
We have acted as counsel to American Country Holdings Inc. (formerly The
Western Systems Corp. and hereinafter the "Company") in connection with its
filing of Post-Effective Amendment No. 2 to Form S-1 Registration Statement on
Form S-3 (File No. 33-68884) (the "Post-Effective Amendment") covering an
aggregate of 4,583,306 shares (the "Shares") of the Company's authorized shares
of Common Stock, $.01 par value, issuable upon exercise of outstanding Common
Stock Purchase Warrants ("Warrants").
As such counsel, we have examined original copies, or copies certified to
our satisfaction, of the corporate records of the Company, agreements and other
instruments, certificates of public officials and such other documents as we
deemed necessary as a basis for the opinion hereinafter set forth.
On the basis of the foregoing, we are of the opinion that the Shares have
been validly authorized and, when issued upon due and valid exercise the
Warrants will be, validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
aforesaid Post-Effective Amendment.
Very truly yours,
EPSTEIN BECKER & GREEN, P.C.
By: /s/ Sidney Todres
----------------------
Sidney Todres
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Post-Effective
Amendment No. 2 to Form S-1 Registration Statement on Form S-3 and related
Prospectus of American Country Holdings Inc. (formerly The Western Systems
Corp.) of our report dated March 12, 1997, with respect to the consolidated
financial statements and schedules of American Country Holdings Inc. included
in its Annual Report on Form 10-K for the year ended December 31, 1996. We also
consent to the reference to our firm under the caption "Experts" in the
Prospectus.
LAZAR, LEVINE & COMPANY LLP
New York, New York
November 3, 1997
Consent of Ernst & Young LLP, Independent Auditors
We consent to the reference to our firm under the caption "Experts" in
Post-Effective Amendment No. 2 to Form S-1 Registration Statement on Form S-3
and related Prospectus of American Country Holdings Inc. for the registration of
4,583,306 shares of its common stock and to the incorporation by reference
therein of our report dated March 7, 1997 except to Note 1, as to which the date
is May 1, 1997, with respect to the consolidated financial statements and
schedules of American Country Insurance Company at December 31, 1996 and 1995,
and for each of the three years in the period ending December 31, 1996 included
in American Country Holdings Inc. definitive Proxy Statement dated June 27,
1997, filed with the Securities and Exchange Commission.
ERNST & YOUNG LLP
November 4, 1997
Chicago, Illinois
