COMFORCE CORP
424B3, 1997-03-07
COSTUME JEWELRY & NOVELTIES
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                                                       RULE NO. 424(b)(3)
                                                       REGISTRATION NO. 33-60403
 
                              COMFORCE CORPORATION

                       SUPPLEMENT DATED MARCH 6, 1997 TO
                       PROSPECTUS DATED FEBRUARY 18, 1997


COMPLETION OF RHO ACQUISITION

          On February 28, 1997, the Company, through its subsidiary COMFORCE
Technical Services, Inc., purchased all of the stock of RHO Company Incorporated
("RHO") for $14.8 million payable in cash, plus a contingent payout to be paid
over two or three years based on future earnings of RHO payable in stock in an
aggregate amount not to exceed $3.3 million.  The maximum amount of the
contingent payout in any year cannot exceed $1.67 million, which, if earned in
full, would  bring the total purchase price to $18.1 million.  The total number
of shares issuable as contingent payouts is equal to the quotient of $3.3
million and the average value of the Common Stock for the 20 consecutive
business days ending three business days prior to the closing of the RHO
acquisition.

          The acquisition was completed under the terms of definitive agreements
entered into by the parties in November 1996. The cash portion of the purchase
price paid at closing, $13.8 million, was principally funded through the
Company's offering of convertible debentures as described below under "Sale of
Convertible Debentures." RHO provides specialists for its customers primarily in
the technical services and IT sectors.  The acquisition of RHO adds nine branch
offices.

MANAGEMENT

          New Directorships.  On February 26, 1997, the Company's Board of
Directors amended its Bylaws to increase the number of directors to seven from
four and elected James L. Paterek and Christopher P. Franco to fill two of the
vacancies.  The Company is currently considering candidates to fill the
remaining vacancy.  This vacancy will be filled by a non-employee director,
which will result in outside directors constituting a majority of the Board.

          Election of Officers.  On February 26, 1997, the Company's Board of
Directors elected James L. Paterek to the position of Chairman of the Board and
Christopher P. Franco to the position of Chief Executive Officer. Mr. Paterek
had previously served as a consultant to the Company and Mr. Franco had served
as the Company's Executive Vice President.  Michael Ferrentino continues to
serve as the Company's President.

          Management Table.  Set forth below is information concerning each
director and executive officer of the Company effective following the actions
taken by the Board on February 26, 1997:

<TABLE>
<CAPTION>
Name                     Age                        Position
<S>                      <C>  <C>
James L. Paterek          35  Chairman of the Board
Christopher P. Franco     37  Chief Executive Officer, Secretary and Director
Michael Ferrentino        34  President and Director
Dr. Glen Miller           59  Director
Keith Goldberg            33  Director
Richard Barber            36  Director
Paul J. Grillo            44  Vice President - Finance and Chief Financial Officer
Andrew Reiben             32  Chief Accounting Officer and Corporate Controller
</TABLE>

SALE OF CONVERTIBLE DEBENTURES

          The Debentures.  Commencing in February 1997, the Company offered its
Subordinated Convertible Debentures ("Debentures") to certain institutional
investors and, from February 28 to March 6, 1997, the Company sold Debentures in
the principal amount of $17.0 million.  The Debentures bear interest at the rate
of 8% per annum 
<PAGE>
 
during the 180 day period following Closing (as defined below) and thereafter at
the rate of 10% per annum continuing until fully paid or converted. Interest on
the Debentures is payable quarterly in cash or in Common Stock of the Company,
at the Company's option. The Debentures may be redeemed by the Company at any
time from and after the date of issuance, in whole or in part, within 360 days
after any disbursement to the Company of net proceeds from the sale of
Debentures (each a "Closing"), at a redemption price equal to the sum of (i) the
principal amount thereof, (ii) all accrued, unpaid interest thereon and (iii)
premiums ranging from 5% (for Debentures redeemed within 60 days after Closing)
to 25% (for Debentures redeemed between 181 and 360 days after Closing).

          The Series F Debentures.  The  Company has also offered to repurchase
all outstanding shares of its Series F Convertible Preferred Stock ("Series F
Preferred Stock") by issuing additional debentures ("Series F Debentures") in
the original principal amount of 115% of the liquidation value of the Series F
Preferred Stock to the holders thereof (the "Series F Holders") in exchange for
the Series F Preferred Stock.  The Series F Debentures received by the Series F
Holders may be redeemed by the Company, at any time from and after the Closing,
in whole or in part, at a redemption price equal to the redemption price for the
Debentures, except that the redemption premium is 50% of the Debenture premium
for redemptions effected through 90 days after Closing.

          Conversion.  The Debentures and the Series F Debentures may be
converted, in whole or in part, at the option of the respective holder thereof
(each a "Buyer") beginning 181 days following the Closing. The Company has the
option to make the requested conversion in either cash or in shares of the
Company's Common Stock, or in any combination thereof.  Cash conversions are
payable at 125% of face value (plus accrued interest). Stock conversions are
payable at 100% of face value (plus accrued interest) in Common Stock valued at
75% of the average closing bid price for the five trading days ending on the
trading day before the conversion.  Any portion of any Debenture or Series F
Debenture which remains outstanding on the 360th day following the Closing will
be automatically converted to cash or shares of Common Stock, or any combination
thereof, as determined by the Company.  Under certain circumstances, the
aggregate number of shares of Common Stock issuable upon exercise of the
Warrants and the Additional Warrants (described below under "--Warrants") or
upon conversion of the Debentures or the Series F Debentures is limited, which
could require that the Company effect certain conversion through cash payments.

          Warrants.  From February 28 to March 6, 1997, the Company issued
warrants ("Warrants") to purchase 340,000 shares of its Company's Common Stock
to the Buyers, which Warrants are exercisable as follows: (a) Warrants to
purchase 68,000 shares become exercisable beginning 6 months after Closing and
ending three years thereafter; (b) if the Debentures or the Series F Debentures
are not redeemed within 60 days after Closing, Warrants to purchase 68,000
shares become exercisable beginning 6 months after Closing and ending three
years thereafter; (c) if the Debentures or the Series F Debentures are not
redeemed within 90 days after Closing, Warrants to purchase 68,000 shares become
exercisable beginning 6 months after Closing and ending three years thereafter;
(d) if the Debentures or the Series F Debentures are not redeemed within 120
days after Closing, Warrants to purchase 68,000 shares become exercisable
beginning 6 months after Closing and ending three years thereafter; and (e) if
the Debentures or the Series F Debentures are not redeemed within 150 days after
Closing, Warrants to purchase 68,000 shares become exercisable beginning 6
months after Closing and ending three years thereafter. The exercise price of
the Warrants ranges from $7.45 to $7.65 per share, which is equal to the average
closing bid price of the Company's Common Stock for the five-day trading period
ending on the day prior to each Closing.

          The Company is also required to issue additional warrants ("Additional
Warrants") to purchase 340,000 shares of the Company's Common Stock to the
Buyers, which Additional Warrants become exercisable to the extent that
Debentures or Series F Debentures are not redeemed within 180 days following
Closing, beginning on the later of (i) the date the Replacement Debentures are
required to be issued or (ii) the effective date of the registration statement
described below under "--Registration" and ending three years thereafter.  The
Additional Warrants will have an exercise price equal to the average closing bid
price of the Company's Common Stock over the five-day trading period ending 179
days after the Closing.  The number of Warrants and Additional Warrants issuable
will be increased to the extent the Series F Holders accept the Company's offer
to exchange their shares of Series F Preferred Stock for Series F Debentures.
<PAGE>
 
          Registration.  The Company is required to cause the shares issuable
upon conversion of the Debentures or Series F Debentures (or payable as interest
thereon) or upon the exercise of the Warrants and Additional Warrants to be
registered for resale under a registration statement filed with the Securities
and Exchange Commission under the Securities Act of 1933 within six months after
Closing.

DESCRIPTION OF THE COMPANY'S SECURITIES -- MODIFICATION OF PAYMENT RIGHTS

          As described under "Description of the Company's Securities--Warrants
and Payment Rights," in connection with the recent private placement of shares
of its Common Stock, the Company granted certain payment rights.  In December
1996, the Company sold 460,000 shares of its Common Stock, together with a
related payment right, for $3.5 million.  This payment right requires the
Company to make a payment to the investors in either cash or Common Stock, at
the Company's option, equal to the amount, if any, by which $10.00 per share
exceeds the average closing bid price for the five trading days prior to a
specified payment date (not later than May 1, 1997).

          In addition, in December 1996, the Company sold 350,000 shares of its
Common Stock, together with a related payment right, for $3.5 million.  This
payment right requires the Company to make a payment to the investors in either
cash or Common Stock, at the Company's option, equal to the amount, if any, by
which $12.05 per share exceeds the average closing bid price for the five
trading days prior to a specified payment date (not later than May 1, 1997).  In
lieu of this amount, a payment of $2.05 per share will be payable if, among
other things, as of May 1, 1997, such average trading price is between $10.00
and $15.00 and the Company's daily trading volume does not meet specified
levels.

          On February 27, 1997, the Company agreed to modify these payment
rights by changing the specified payment date from May 1, 1997 to April 1, 1997.
In addition, the Company granted to the holders of the 460,000 shares put
options which permit the holders to require the Company to repurchase 115,000
shares on each of April 28, 1997, May 28, 1997, June 27, 1997 and July 27, 1997,
in cash, at a repurchase price of $10.00 per share (subject to adjustment to
give effect to any consideration received by the holders through the payment
rights described above).

          See also "Sale of Convertible Debentures" for a description of the
Debentures, Series F Debentures, Warrants and Additional Warrants issued by the
Company.


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