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As filed with the Securities and Exchange Commission on January 17, 2001
Registration No. 333-_____
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SECURITIES AND EXCHANGE COMMISSION
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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NEWPARK RESOURCES, INC.
(Exact name of registrant as specified in its charter)
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<S> <C>
Delaware 72-1123385
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
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3850 NORTH CAUSEWAY, SUITE 1770
METAIRIE, LOUISIANA 70002
(504) 838-8222
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
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JAMES D. COLE
CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER
NEWPARK RESOURCES, INC.
3850 NORTH CAUSEWAY, SUITE 1770
METAIRIE, LOUISIANA 70002
(504) 838-8222
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copy to:
HOWARD Z. BERMAN, ESQ.
ERVIN, COHEN & JESSUP LLP
9401 WILSHIRE BOULEVARD, 9TH FLOOR
BEVERLY HILLS, CALIFORNIA 90212
(310) 273-6333
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Approximate date of proposed sale to the public: From time to time
after this Registration Statement becomes effective, as determined by market
conditions.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [ ]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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Title of each class of Proposed Proposed maximum
securities to be Amount to be maximum offering aggregate offering Amount of
registered registered(1) price per unit(2) price(2) registration fee
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<S> <C> <C> <C> <C>
Common Stock, $.01
par value 5,758,422 Shares $7.91 $45,549,118 $11,387.28
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</TABLE>
(1) The shares of common stock that may be offered pursuant to this
Registration Statement consist of shares issuable upon conversion of
and as dividends upon 120,000 shares of Series C Convertible Preferred
Stock. For purposes of estimating the number of shares of common stock
to be included in this Registration Statement, we included (a)
5,510,451 shares, representing 150% of the number of shares of common
stock issuable upon conversion of the Series C Convertible Preferred
Stock, determined as if the Series C Convertible Preferred Stock were
converted in full at a conversion price of $8.1663; plus (b) 247,971
shares, representing 150% of the number of shares of common stock
issuable as dividends on the Series C Convertible Preferred Stock
within one year from January 17, 2001, assuming the price used to
calculate this number of shares was $8.1663 per share. Pursuant to Rule
416 under the Securities Act of 1933, this Registration Statement also
covers an indeterminate number of shares of common stock issuable upon
conversion of or as dividends on the Series B Convertible Preferred
Stock by reason of stock splits, stock dividends and other
anti-dilution adjustments.
(2) Estimated solely for purposes of calculating the amount of the
registration fee pursuant to Rule 457(c) and (g), based on the average
of the high and low prices for shares of the registrant's common stock,
as reported by The New York Stock Exchange, on January 12, 2001
($7.91).
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
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THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THESE
SECURITIES MAY NOT BE SOLD UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
PROSPECTUS SUBJECT TO COMPLETION, DATED JANUARY 17, 2001
5,758,422 SHARES
[NEWPARK RESOURCES, INC. LOGO]
NEWPARK RESOURCES, INC.
COMMON STOCK
($.01 par value)
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From time to time, the selling stockholder identified in the "Selling
Stockholder" section on page 18 of this prospectus may offer and sell, by using
this prospectus, up to 5,758,422 shares of our common stock.
Our common stock is listed on The New York Stock Exchange under the
symbol "NR". On January 16, 2001, the last reported sale price of our common
stock on The New York Stock Exchange was $8.375 per share.
The offering price for the common stock may be the market price for our
common stock prevailing at the time of sale, a price related to the prevailing
market price, a negotiated price or any other price that the selling stockholder
determines from time to time.
BEFORE PURCHASING ANY OF THE SHARES OF COMMON STOCK COVERED BY THIS
PROSPECTUS, YOU SHOULD CONSIDER CAREFULLY THE RISK FACTORS BEGINNING ON PAGE 6
OF THIS PROSPECTUS.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR DETERMINED THAT THIS
PROSPECTUS IS ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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The date of this Prospectus is January __, 2001.
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TABLE OF CONTENTS
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PAGE
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Prospectus Summary......................................................... 3
Risk Factors............................................................... 6
Forward Looking Statements................................................. 17
Use of Proceeds............................................................ 18
Selling Stockholder........................................................ 18
Plan of Distribution....................................................... 21
Where You Can Find More Information........................................ 23
Legal Matters.............................................................. 24
Experts.................................................................... 24
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PROSPECTUS SUMMARY
The following summary should be read by you together with the more
detailed information included in other sections of this prospectus or
incorporated by reference into this prospectus. In addition, you should
carefully consider the factors described under "Risk Factors" beginning at page
6 of this prospectus.
Throughout this prospectus, we refer to Newpark Resources, Inc. and its
subsidiaries as "us", "we", "our" or "Newpark".
THE COMPANY
Newpark Resources, Inc. is a leading provider of proprietary
environmental services to the oil and gas exploration and production industry.
We operate primarily in the U.S. Gulf Coast market. We provide, either
individually or as part of a comprehensive package, the following services:
o we sell drilling fluids and provide associated engineering and
technical services;
o we provide patented hardwood and composite interlocking mats
for use as temporary access roads and work sites in oilfield
and other construction applications;
o we sell lumber, timber and wood by-products;
o we process and dispose of oilfield exploration and production,
or E&P, waste;
o we provide other related on-site environmental and oilfield
construction services; and
o we process and dispose of non-hazardous wastes for the
refining, petrochemical and manufacturing industry in the U.S.
Gulf Coast market.
We offer our drilling fluids, fluids processing and management and
waste disposal services in an integrated package we call "Minimization
Management", or "MM(TM)". This allows our customers to consolidate their
outsourced services and reduce the number of vendors used. It can also speed up
the drilling process while reducing the amount of waste that must be disposed
of. We believe our Minimization Management, or MM(TM), program differentiates us
from our competitors and increases the efficiencies of our customers' drilling
operations.
In our drilling fluids business, we focus on providing unique solutions
to highly technical drilling projects involving complex conditions. These
projects require critical engineering support of the fluids system during the
drilling process to ensure optimal performance at the lowest total well cost. We
have developed and begun to market several proprietary and patented products
that replace environmentally harmful substances commonly used in drilling
fluids. These elements are typically of the greatest concern in the waste stream
created by drilling fluids. We recently introduced a new, high-performance,
water-based fluid system using these products, and we call this system
"DeepDrill(TM)". We believe that these new products will make it easier for our
customers to comply with increasingly strict environmental regulations affecting
their drilling operations and improve the economics of the drilling process.
In addition to the U.S. Gulf Coast market, in 1998, we expanded our
drilling fluids operations into west Texas, the U.S. Mid-continent, the U.S.
Rockies and western Canada by acquiring several drilling fluids companies. We
have the service infrastructure necessary to
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participate in the drilling fluids market in these regions. We also have our own
barite grinding capacity to provide critical raw materials for our drilling
fluids operations, primarily in the U.S. Gulf Coast market.
In our mat business, we use patented interlocking wooden and composite
mat systems to provide temporary access roads and worksites in unstable soil
conditions. These mats are used primarily in support of oil and gas exploration
operations along the U.S. Gulf Coast and are typically rented to the customer.
Occasionally, however, we sell the mats to the customer for permanent access to
a site or facility. Since 1994, we also have marketed mat services for use in
constructing and maintaining pipelines, electrical distribution systems and
highways in and through wetlands environments, including the coastal areas of
the southeastern U.S., particularly Florida and Georgia. We also market mat
services to the oil and gas exploration industries in western Canada.
We recently started using our new Dura-Base(TM) composite plastic mat,
primarily in our U.S. Gulf Coast market. We believe the Dura-Base(TM) mat will
in many applications replace our traditional wooden mats. We believe the new
plastic mats provide significant economic benefits to us, because they are
lighter, stronger, require less repair and last longer than our wooden mats. We
also are currently exploring selling these mats to various governmental
agencies, which we believe view the strength, durability and shelf life of our
composite mats as an advantage over traditional wooden mats.
Most of the E&P waste received by us is processed and then injected
into environmentally secure geologic formations deep underground. Some waste is
delivered to surface disposal facilities. We also can process E&P waste into a
product which is used as daily cover material or cell liner and construction
material at two municipal waste landfills, although we do not currently use this
method for a significant volume of waste.
Since 1994, we have been licensed to process E&P waste contaminated
with naturally occurring radioactive material, or NORM. We currently operate
under a license that authorizes the direct injection of NORM into disposal wells
at our Big Hill, Texas facility. This is the only offsite facility in the U.S.
Gulf Coast licensed for this purpose. Since July 1999, we also have been
operating a facility adjacent to our NORM facility to dispose of non-hazardous
industrial waste produced by the petrochemical processing and refining
industries. This facility uses the same waste disposal technology as we use for
E&P waste and NORM waste disposal.
We also provide other services for our customers' oil and gas
exploration and production activities. These services include the following:
o site assessment;
o waste pit design;
o construction and installation;
o regulatory compliance assistance;
o site remediation and closure; and
o oilfield construction services, including hooking up and
connecting wells and installing production equipment.
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We were originally organized in 1932 as a Nevada corporation. In April
1991, we changed our state of incorporation to Delaware. Our principal executive
offices are located at 3850 North Causeway Boulevard, Suite 1770, Metairie,
Louisiana 70002. Our telephone number is (504) 838-8222.
THE OFFERING
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Securities offered by the selling stockholder... 5,758,422 shares of our common stock(1). See
"Selling Stockholder" on page 18.
Use of Proceeds................................. We will not receive any proceeds from the sale
of the common stock by the selling stockholder.
Risk Factors.................................... The shares of common stock offered under this
prospectus involve a high degree of risk. See
"Risk Factors" beginning on page 6.
New York Stock Exchange Symbol.................. NR
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(1) Consists of shares of our common stock issuable upon conversion of our
Series C Convertible Preferred Stock and as dividends on the Series C
Convertible Preferred Stock within one year following the effective
date of the Registration Statement of which this prospectus is a part.
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RISK FACTORS
In addition to the other information in this prospectus, including the
information which we have incorporated by reference into this prospectus, you
should consider carefully the risk factors described below relating to our
business before you decide to buy any of the shares offered by this prospectus.
OUTSTANDING PREFERRED STOCK AND WARRANTS COULD RESULT IN POTENTIAL DILUTION AND
IMPAIR THE PRICE OF OUR COMMON STOCK.
To the extent that our outstanding shares of preferred stock are
converted into common stock or outstanding warrants to purchase common stock are
exercised, our existing common stockholders will experience dilution in their
percentage ownership interests. The following table provides certain information
regarding the number of shares of our common stock issuable upon conversion of
our outstanding shares of preferred stock and our outstanding warrants to
purchase common stock:
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NUMBER OF SHARES OF DILUTION OR ACCRETION
COMMON STOCK PERCENTAGE OF IN BOOK VALUE PER SHARE
ISSUABLE UPON OUTSTANDING UPON CONVERSION
CONVERTIBLE SECURITY CONVERSION OR EXERCISE COMMON STOCK(1) OR EXERCISE(2)
-------------------- ---------------------- --------------- -----------------------
<S> <C> <C> <C>
Series A Cumulative Perpetual
Preferred Stock (3).............. 1,949,405 2.72% $(.10)
Series B Convertible Preferred
Stock (4)........................ 3,692,921 5.04% $(.18)
Series C Convertible Preferred
Stock (5)........................ 3,680,522 5.02% $(.18)
Series A Warrants (6)............ 2,400,000 3.33% $ .16
Series B Warrants (7)............ 1,900,000 2.66% $ .17
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Total.......................... 13,622,848 16.36% $(.12)
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(1) Based on a total of 69,641,737 shares of our common stock outstanding
as of January 12, 2001 and in each case after giving effect to the
issuance of those shares.
(2) Assumes conversion or exercise as of September 30, 2000, based on a
total of 69,519,487 shares or our common stock outstanding and total
stockholders' equity of $223,673,000 as of that date, plus estimated
net proceeds from the Series C Convertible Preferred Stock of
$29,950,000.
(3) Based on a conversion price of $7.70 as of January 12, 2001, determined
in accordance with the conversion formula contained in the certificate
relating to the Series A Cumulative Perpetual Preferred Stock, and
includes 1,353 shares of common stock issuable with respect to accrued
but unpaid dividends. The Series A Cumulative Perpetual Preferred Stock
is not convertible until June 1, 2004.
(4) Based on a conversion price of $8.1663 as of January 12, 2001,
determined in accordance with the conversion formula contained in the
certificate relating to the Series B Convertible Preferred Stock, and
includes 19,287 shares of common stock issuable with respect to accrued
but unpaid dividends.
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(5) Based on a conversion price of $8.1663 as of January 12, 2001,
determined in accordance with the conversion formula contained in the
certificate relating to the Series C Convertible Preferred Stock, and
includes 6,888 shares of common stock issuable with respect to accrued
but unpaid dividends.
(6) The Series A Warrants are presently exercisable and have an exercise
price of $8.50 per share.
(7) The Series B Warrants are presently exercisable and have an exercise
price of $10.075 per share.
Because of the conversion features in our outstanding shares of
preferred stock, the preferred stockholders will receive a greater number of
shares of common stock upon conversion if our common stock price declines. In
addition, we are required to make quarterly dividend payments with respect to
the Series A Cumulative Perpetual Preferred Stock, which we are to pay in shares
of our common stock until April 2002. We also must pay quarterly dividends on
the Series B Convertible Preferred Stock and the Series C Convertible Preferred
Stock, which also may be paid in shares of our common stock if we satisfy
certain conditions. The number of shares to be issued in payment of these
dividends will depend on the market value of those shares when they are issued.
As a result, the preferred stockholders will receive a greater number of shares
of common stock in payment of these dividends if our common stock price
decreases.
If the preferred stockholders convert their preferred stock or exercise
their warrants and then sell our common stock, the market price of our common
stock may decline due to the additional shares in the market. This could allow
the preferred stockholders to convert their remaining preferred stock, if any,
into greater amounts of common stock, the sales of which may further depress the
stock price. This potential downward pressure on the price of our common stock
could encourage short sales and consequently place further downward pressure on
the market price of our common stock.
The additional shares of common stock available for sale upon
conversion of the preferred stock, as dividends on the preferred stock or upon
exercise of the warrants may have a negative impact on the price of the
outstanding common stock. In addition, sales by the selling stockholder or
others of substantial amounts of our common stock in the public market, or the
perception that these sales might occur, could depress the price of our common
stock. The selling stockholder has the sole discretion to determine the timing,
structure and all terms of any disposition of our common stock, all of which
could affect the market price of our common stock.
We currently do not have any commitments to sell any additional
convertible securities or warrants to purchase any shares of our common stock.
WE MAY BE REQUIRED TO OBTAIN THE CONSENT OF OUR STOCKHOLDERS IF (i) THE TOTAL
NUMBER OF SHARES OF OUR COMMON STOCK ISSUABLE WITH RESPECT TO THE SERIES C
CONVERTIBLE PREFERRED STOCK EXCEEDS 13,905,718 SHARES OR (ii) THE TOTAL NUMBER
OF SHARES ISSUABLE WITH RESPECT TO THE SERIES B CONVERTIBLE PREFERRED STOCK AND
THE WARRANT ISSUED BY US ON JUNE 1, 2000 EXCEEDS 13,825,034 SHARES, AND WE WILL
INCUR PENALTIES IF WE DO NOT TIMELY OBTAIN THIS CONSENT.
The rules of the New York Stock Exchange require us to obtain
stockholder approval if the total number of shares of common stock issuable with
respect to the Series C Convertible Preferred
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Stock is more than 13,905,718. This number is 19.99% of the number of shares of
common stock we had outstanding on December 27, 2000. We also will be required
to obtain stockholder approval if the total number of shares of common stock
issuable with respect to the Series B Convertible Preferred Stock and the
warrant issued by us on June 1, 2000 is more than 13,825,034. This number is
19.99% of the number of shares of common stock we had outstanding on May 30,
2000. If we fail to comply with this rule, the New York Stock Exchange may
delist our common stock, which could negatively affect the price of our common
stock and your ability to sell our common stock.
Because the conversion features of both the Series B Convertible
Preferred Stock and the Series C Preferred Stock are tied to the market price of
our common stock, and because the number of shares we are to issue as dividends
with respect to the Series B Convertible Preferred Stock and the Series C
Convertible Preferred Stock also is dependent on the market price of our common
stock, we could be required to obtain this stockholder consent if the market
price of our common stock were to drop significantly. As described below, if we
fail to obtain this stockholder consent on a timely basis, we could be required
to issue to the holder of the Series B Convertible Preferred Stock additional
shares of Series B Convertible Preferred Stock or shares of common stock upon
exercise of the warrant without receiving any cash consideration for those
securities. We also could be required to issue to the selling stockholder
additional shares of Series C Convertible Preferred Stock without receiving any
cash consideration for those shares.
If we are required to obtain stockholder consent with respect to the
issuance of the Series B Convertible Preferred Stock and warrant, and this
consent is not received within 60 days after notice is sent to us by the holder
of those securities, the holder may elect to do either or a combination of the
following:
o a cashless exercise of the warrant for up to that number of
shares of our common stock that would require stockholder
consent;
o convert the number of shares exceeding 13,825,034 into a right
with a value equal to the market price of our common stock on
the notice date, in the case of Series B Convertible Preferred
Stock, and the spread between the market price of our common
stock over the exercise price of the warrant on the notice
date, in the case of the warrant, times the number of shares
of our common stock converted into this right.
For one year after it is issued, the holder of the Series B Convertible
Preferred Stock and the warrant may apply this right, on a dollar-for-dollar
basis, in lieu of payment of the exercise price under the warrant. The holder
also may convert this right during that one-year period into shares with
substantially the same rights and obligations as the Series B Convertible
Preferred Stock at the ratio of one share for each $250 in stated value of the
right.
In addition, if we are required to obtain stockholder consent with
respect to the issuance of the Series C Convertible Preferred Stock, and this
consent is not received within 60 days after notice is sent to us by the selling
stockholder, the selling stockholder may elect to convert the number of shares
exceeding 13,905,718 into a right with a value equal to the market price of our
common stock on the notice date times the number of shares of our common stock
converted into this right. For one year after it is issued, this right may be
converted into shares with substantially the same rights and obligations as the
Series C Convertible Preferred Stock at the ratio of one share for each $250 in
stated value of the right.
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A MATERIAL DECLINE IN THE LEVEL OF OIL AND GAS EXPLORATION AND PRODUCTION AND
ANY REDUCTION IN THE INDUSTRY'S WILLINGNESS TO SPEND CAPITAL ON ENVIRONMENTAL
AND OILFIELD SERVICES COULD ADVERSELY AFFECT THE DEMAND FOR OUR SERVICES.
Prices for oil and natural gas are volatile, and this volatility
affects the demand for our services. A material decline in oil or natural gas
prices or activities, as occurred during 1998, could materially affect the
demand for our services and, therefore, our consolidated financial statements.
We will continue to be impacted by changes in oil and gas supply and demand,
which are generally affected by the following factors:
o Oil and gas prices;
o Expectations about future prices;
o The cost to explore for, produce and deliver oil and gas;
o The discovery rate for new oil and gas reserves;
o The ability of oil and gas companies to raise capital;
o Domestic and international political, military, regulatory and
economic conditions; and
o Government regulations regarding, among other things,
environmental protection, taxation, price controls and product
allocation.
The potential fluctuations in the level of future oil and gas industry
activity or demand for our services and products are difficult, if not
impossible, to predict. There may be times when oil and gas industry activity or
demand for our services may be less than expected.
OUR OPERATING RESULTS HAVE FLUCTUATED DURING RECENT YEARS, AND THESE
FLUCTUATIONS MAY CONTINUE, WHICH MAY HAVE AN ADVERSE EFFECT ON THE MARKET PRICE
OF OUR COMMON STOCK.
We have experienced in the past, and may continue to experience in the
future, fluctuations in our yearly and quarterly operating results. It is
possible that we will not realize expected earnings growth and that earnings in
any particular year or quarter will fall short of either a prior fiscal year or
quarter or investors' expectations. If this were to occur, the market price of
our common stock would likely be adversely affected. The following factors, in
addition to others not listed, may affect our operating results in the future:
o fluctuations in the oil and gas industry;
o competition;
o the ability to manage and control our operating costs;
o the rate and extent of acceptance of our new drilling fluids
products and our new composite mats;
o our ability to efficiently integrate and operate businesses
that we have recently acquired; and
o the ability to identify strategic acquisitions at reasonable
prices.
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WE ARE HIGHLY LEVERAGED AND MAY NOT HAVE SUFFICIENT CASH FLOW FROM OPERATIONS TO
MEET OUR DEBT SERVICE REQUIREMENTS.
Our balance sheet is highly leveraged given our present operating
level. There is a risk that we may be unable to obtain sufficient cash flow from
operations or obtain other financing in the future to repay this debt. As of
December 31, 1999, we had approximately $209.2 million of long-term debt, and we
had approximately $200.0 million of long-term debt, or debt that is due to be
repaid in no less than one year, as of September 30, 2000. For the year ended
December 31, 1999, we had total interest expense of approximately $16.7 million,
and the current portion of our long-term debt was $1.6 million at December 31,
1999. For the twelve-month period ended September 30, 2000, we had total
interest expense of approximately $18.4 million, with $407,000 in current
maturities of our long term debt. Our ability to meet our debt service
requirements and comply with the covenants in our various debt agreements,
including the indenture governing our senior subordinated notes, will depend on
our future performance. This, in turn, is subject to the volatile nature of the
oil and gas industry, and to competitive, economic, financial and other factors
that are beyond our control. If we are unable to obtain sufficient cash flow
from operations or obtain other financing in the future to service our debt, we
may be required to sell assets, reduce capital expenditures or refinance all or
a portion of our existing debt in order to continue to operate. We may not be
able to obtain any additional debt or equity financing if and when needed, and
the terms we may be required to offer for this additional debt or equity
financing may not be as favorable as the terms we have been able to obtain in
the past.
Substantially all of our assets are pledged to secure our credit
facility, and the indenture governing our senior subordinated notes restricts
our ability to incur additional debt. In particular, we may not incur additional
debt unless the ratio of our net income before income taxes, interest expense
and certain non-cash charges for the four preceding fiscal quarters, to our
interest expense for the same four quarters, would be at least 2:1. In
calculating this "fixed charge coverage ratio", the additional debt is treated
as if it had been incurred on the first day of the four quarter period, and
several other adjustments required by the indenture are made. The principal
exceptions to this restriction include our ability to:
o refinance existing debt without increasing the amount of that
debt;
o incur up to $100,000,000 of debt under our credit facility or
a replacement or refinancing of our credit facility;
o issue bonds, letters of credit and similar items in the
ordinary course of our business;
o incur capitalized leases and obligations for the purchase of
property not exceeding a total of $20,000,000; and
o have outstanding at any time up to $25,000,000 of additional
debt.
As of September 30, 2000, not including amounts available under our
credit facility, the refinance of existing debt and the issuance of bonds,
letters of credit and similar items in the ordinary course of business, we could
incur up to $43.1 million of additional debt within the indenture restrictions.
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WE MAY NOT BE ABLE TO COMPLY WITH ALL OF THE RESTRICTIONS IMPOSED BY THE TERMS
OF OUR INDEBTEDNESS AND COULD BE PLACED IN DEFAULT BY OUR LENDERS.
Both the indenture governing the terms of our senior subordinated notes
and our credit facility contain restrictive covenants with which we may not be
able to comply. Our credit facility also requires us to satisfy certain
financial tests. If we were to breach these covenants or fail to satisfy these
financial tests, all amounts owing, including accrued interest, under both our
senior subordinated notes and our credit facility could be declared immediately
due and payable. The lenders under the credit facility also could terminate all
commitments under the credit facility and enforce their rights to their security
interests on substantially all of our assets. In addition, a default under our
credit facility could constitute a cross-default under the indenture, and a
default under the indenture could constitute a cross-default under our credit
facility.
Our ability to comply with these restrictive covenants and satisfy
these financial tests may be affected by events beyond our control. These events
include changes in oil and gas exploration and production levels and industry
conditions that affect our financing and capital needs. The indenture includes
covenants limiting our ability to:
o incur additional debt;
o pay dividends and redeem capital stock;
o make certain investments;
o issue any capital stock of our subsidiaries;
o create any liens or other restrictions affecting our
subsidiaries;
o issue any guarantees;
o enter into transactions with any of our affiliates; and
o sell assets, merge or consolidate.
WE HAVE HIGH LEVELS OF FIXED COSTS THAT MAY NOT BE COVERED IF THERE ARE ANY
DOWNTURNS IN OUR BUSINESS.
Our business has high fixed costs, and downtime or low productivity due
to reduced demand, weather interruptions, equipment failures or other causes can
result in significant operating losses.
WE MAY NOT BE ABLE TO SUCCESSFULLY INTEGRATE OUR RECENT ACQUISITIONS INTO OUR
OPERATIONS, AND THESE ACQUISITIONS MAY NOT ACHIEVE SALES AND PROFITABILITY
LEVELS THAT JUSTIFY OUR INVESTMENT IN THEM. THIS COULD RESULT IN THESE
BUSINESSES PLACING DOWNWARD PRESSURE ON OUR MARGINS OR OUR DISPOSING OF THESE
BUSINESSES AT A LOSS.
We have acquired a number of companies over the past few years,
primarily during 1997 and 1998, as we have expanded our product offerings and
geographic presence. We may not be able to profitably manage the companies that
we have acquired over the past few years or be able to successfully integrate
these companies into our existing operations. This may occur as a result of our
inability to supervise or retain the management and other employees of the
acquired companies or to implement our cost controls and other systems in these
companies. These companies also may not achieve sales and profitability levels
that justify our investment in them, which may be the result of the failure to
realize anticipated synergies from the acquisitions. These synergies include
potential cross-selling opportunities and economies of scale, such as volume
discounts and sharing of
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<PAGE> 13
resources. If an acquired company does not achieve adequate sales and
profitability levels, it could place downward pressure on our margins, result in
our recording an impairment charge on the goodwill of the acquired company or
result in our disposing of the company at a loss.
WE HAVE HIGH LEVELS OF GOODWILL IN RELATION TO OUR TOTAL ASSETS AND
STOCKHOLDERS' EQUITY AS A RESULT OF OUR RECENT ACQUISITIONS. THIS COULD HAVE A
SIGNIFICANT IMPACT ON OUR FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
As of December 31, 1999, we had recorded over $116.4 million in
unamortized costs in excess of net assets of businesses we acquired and
identifiable intangible assets. These costs are being amortized on a
straight-line basis over 15 to 35 years. Our estimates of the values and useful
lives of these assets could be reduced in the future as a result of various
factors beyond our control. Any reduction in the value of these assets would
reduce our reported income or increase our reported loss and reduce our total
assets and stockholders' equity in the year in which the reduction is
recognized. Any reduction in the useful lives of these assets would increase the
amount of our annual amortization expense, reduce our annual reported income or
increase our reported losses and reduce our stockholders' equity.
The $116.4 million balance of unamortized costs represents 25.6% of our
total assets and 62.5% of our total stockholders' equity as of December 31,
1999. For the year ended December 31, 1999, this amortization increased our
pre-tax reported loss by $5.0 million. For the year ended December 31, 1998,
this amortization increased our pre-tax reported loss by $5.2 million.
WE MAY NOT BE ABLE TO KEEP PACE WITH THE CONTINUAL AND RAPID TECHNOLOGICAL
DEVELOPMENTS THAT CHARACTERIZE THE MARKET FOR OUR PRODUCTS AND SERVICES, AND OUR
FAILURE TO DO SO MAY RESULT IN OUR LOSS OF MARKET SHARE.
The market for our products and services is characterized by continual
and rapid technological developments that have resulted in, and will likely
continue to result in, substantial improvements in product functions and
performance. If we are not successful in developing and marketing, on a timely
and cost-effective basis, product enhancements or new products that respond to
technological developments that are accepted in the marketplace or that comply
with industry standards, we could lose market share. In addition, current
competitors or new market entrants may develop new technologies, products or
standards that could render some of our products or services obsolete, which
could have a material adverse effect on our consolidated financial statements.
Our future success and profitability are dependent upon our ability to:
o improve our existing product lines;
o address the increasingly sophisticated needs of our customers;
o maintain a reputation for technological leadership;
o maintain market acceptance of our products and services; and
o anticipate changes in technology and industry standards and
respond to technological developments on a timely basis,
either internally or through strategic alliances.
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<PAGE> 14
THE DEMAND FOR OUR SERVICES MAY BY ADVERSELY AFFECTED BY SHORTAGES OF CRITICAL
EQUIPMENT IN THE OIL AND GAS INDUSTRY AND PERSONNEL TRAINED TO OPERATE THIS
EQUIPMENT.
Shortages of critical equipment necessary to explore for, produce or
deliver oil and gas have on occasion limited the amount of drilling activity in
our primary markets. There also have been shortages of qualified personnel
necessary to operate this equipment. Shortages in either of these areas could
limit the amount of drilling activity and, accordingly, the demand for our
services. There is a risk that these shortages may occur again in the future and
reduce the demand for our services. These shortages also may limit our ability
to expand our services or geographic presence.
IF WE LOSE KEY PERSONNEL OR ARE UNABLE TO HIRE ADDITIONAL QUALIFIED PERSONNEL,
WE MAY NOT BE SUCCESSFUL.
Our future success depends on our ability to retain our highly-skilled
engineers and technical sales and service personnel. The market for these
employees is very competitive, and if we cannot continue to attract and retain
quality personnel, our ability to compete effectively and to grow our business
will be severely limited. We expect that as conditions improve in the oil and
gas market generally, the supply of qualified personnel in the oilfield service
industry could tighten substantially. Furthermore, attracting and retaining
qualified personnel in our industry typically requires attractive compensation
packages. A significant increase in the wages paid by competing employers could
result in a reduction in our skilled labor force, increases in the rates of
wages we must pay, or both. Our success also depends upon the continuing
contributions of our key executive officers, many of whom would be difficult to
replace, including James D. Cole, our Chairman and Chief Executive Officer and
Wm. Thomas Ballantine, our President. None of our executive officers is covered
by a long-term employment contract, and we do not know how long they will remain
with our organization. We do not have key man life insurance policies on any of
our personnel.
A RECISSION OR RELAXATION OF GOVERNMENT REGULATIONS COULD REDUCE THE DEMAND FOR
OUR SERVICES AND REDUCE OUR REVENUES AND INCOME. CHANGES IN EXISTING REGULATIONS
ALSO COULD REQUIRE US TO CHANGE THE WAY WE DO BUSINESS, WHICH MAY HAVE A
MATERIAL ADVERSE AFFECT ON OUR CONSOLIDATED FINANCIAL STATEMENTS.
We believe that the demand for our principal environmental services is
directly related to regulation of E&P waste. If these regulations were rescinded
or relaxed, or governmental authorities failed to enforce these regulations, we
could see a decrease in the demand for our services. This decrease in demand
could materially affect our consolidated financial statements. We may also be
affected adversely by new regulations or changes in other applicable
regulations.
E&P waste that is not contaminated with NORM is currently exempt from
the principal Federal statute governing the handling of hazardous waste. In
recent years, proposals have been made to rescind this exemption. If the
exemption covering this type of E&P waste is repealed or modified, we could be
required to alter significantly our method of doing business. We also could be
required to change the way we do business if the regulations interpreting the
rules regarding the treatment or disposal of E&P waste or NORM waste were
changed. If we are required to change the way we do business, it could have a
material adverse effect on our consolidated financial statements.
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<PAGE> 15
OUR PATENTS OR OTHER PROPRIETARY TECHNOLOGY MAY NOT PREVENT OUR COMPETITORS FROM
DEVELOPING SUBSTANTIALLY SIMILAR TECHNOLOGY, WHICH WOULD REDUCE ANY COMPETITIVE
ADVANTAGES WE MAY HAVE FROM THESE PATENTS AND PROPRIETARY TECHNOLOGY.
We hold U.S. and foreign patents for certain of our drilling fluids
systems and mat systems. We also hold U.S. patents on certain aspects of our
system to process and dispose of E&P waste, including E&P waste that is
contaminated with NORM. However, these patents are not a guarantee that we will
have a meaningful advantage over our competitors, and there is a risk that
others may develop systems that are substantially equivalent to those covered by
our patents. If that were to happen, we would face increased competition from
both a service and a pricing standpoint. In addition, costly and time-consuming
litigation could be necessary to enforce and determine the scope of our patents
and proprietary rights. Our business could be negatively impacted by future
technological change and innovation. It is possible that future innovation could
change the way companies drill for oil and gas, reduce the amount of waste that
is generated from drilling activities or create new methods of disposal or new
types of drilling fluids. This could reduce the competitive advantages we may
derive from our patents and other proprietary technology.
WE FACE INTENSE COMPETITION IN OUR EXISTING MARKETS AND EXPECT TO FACE TOUGH
COMPETITION IN ANY MARKETS INTO WHICH WE SEEK TO EXPAND. THIS WILL PUT PRESSURE
ON OUR ABILITY TO MAINTAIN OUR CURRENT MARKET SHARE AND MAY LIMIT OUR ABILITY TO
EXPAND OUR MARKET SHARE OR ENTER INTO NEW MARKETS.
E&P waste processing is a relatively new industry. We expect that
competition in this market will increase as the industry develops, which could
put downward pressure on our margins or make it more difficult for us to
maintain or expand our market share. In the meantime, we would expect to
encounter significant competition if we try to expand into new geographic areas
or if we introduce new services. Barriers to entry by competitors in the
environmental and oilfield services industries are low. Therefore, competitive
products and services have been and may be developed and marketed successfully
by others. We also face competition from efforts by oil and gas producing
customers to improve their own methods of disposal. By doing so, they can reduce
or eliminate the need to use third party E&P waste disposal companies like us.
Our ability to expand our business or increase prices will also be affected by
future technological change and innovation, which could affect our customers'
decisions to use their own methods of disposal. We also face competition in the
drilling fluids market, where there are several companies larger than us that
may have both lower capital costs and greater geographic coverage. There also
are numerous smaller companies competing against us in the drilling fluids
market. These companies may have a lower total cost structure.
WE MAY FAIL TO COMPLY WITH ANY OF THE NUMEROUS FEDERAL, STATE AND LOCAL LAWS,
REGULATIONS AND POLICIES THAT GOVERN ENVIRONMENTAL PROTECTION, ZONING AND OTHER
MATTERS APPLICABLE TO OUR BUSINESS, OR THESE REGULATIONS AND POLICIES MAY
CHANGE. IF THAT WERE TO HAPPEN, WE MAY FACE FINES OR OTHER PENALTIES FOR OUR
FAILURE TO COMPLY OR BE FORCED TO MAKE SIGNIFICANT CAPITAL EXPENDITURES OR
CHANGES TO OUR OPERATIONS TO COMPLY WITH THESE NEW REGULATIONS.
These laws and regulations have changed frequently in the past, and it
is reasonable to expect additional changes in the future. If existing regulatory
requirements change, we may be required to make significant unanticipated
capital and operating expenditures. There is a risk that our operations
14
<PAGE> 16
may not comply with future laws and regulations. In that event, governmental
authorities may seek to impose fines and penalties on us or to revoke or deny
the issuance or renewal of operating permits for failure to comply with
applicable laws and regulations. Under these circumstances, we might be required
to reduce or cease operations or conduct site remediation or other corrective
action. Any of these results could have a material adverse effect on our
consolidated financial statements.
OUR BUSINESS EXPOSES US TO POTENTIAL ENVIRONMENTAL OR REGULATORY LIABILITY, AND
WE COULD BE REQUIRED TO PAY SUBSTANTIAL AMOUNTS WITH RESPECT TO THESE
LIABILITIES, INCLUDING THE COSTS TO CLEAN UP AND CLOSE CONTAMINATED SITES.
Our business exposes us to the risk that harmful substances may escape
into the environment, which could result in:
o personal injury or loss of life;
o severe damage to or destruction of property; and
o environmental damage and suspension of operations.
Our current and past activities, as well as the activities of our
former divisions and subsidiaries, could result in our facing substantial
environmental, regulatory and other liabilities. This could include the costs of
cleanup of contaminated sites and site closure obligations. These liabilities
could also be imposed on the basis of one or more of the following theories:
o negligence;
o strict liability;
o breach of contract with customers; and
o our contractual agreements to indemnify our customers in the
normal course of our business.
Certain aspects of the technology we use in our injection wells have
not been used before by others. The future performance of this technology is
uncertain.
WE MAY NOT HAVE ADEQUATE INSURANCE FOR POTENTIAL LIABILITIES, AND ANY
SIGNIFICANT LIABILITY NOT COVERED BY INSURANCE OR IN EXCESS OF OUR COVERAGE
LIMITS COULD HAVE A MATERIAL ADVERSE AFFECT ON OUR FINANCIAL CONDITION.
While we maintain liability insurance, this insurance is subject to
coverage limits. In addition, certain policies do not provide coverage for
damages resulting from environmental contamination. We face the following risks
with respect to our insurance coverage:
o we may not be able to continue to obtain insurance on
commercially reasonable terms or at all;
o we may be faced with types of liabilities that will not be
covered by our insurance;
o our insurance carriers may not be able to meet their
obligations under the policies; and
o the dollar amount of any liabilities may exceed our policy
limits.
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<PAGE> 17
Even a partially uninsured claim, if successful and of significant
size, could have a material adverse effect on our consolidated financial
statements.
WE ARE SUBJECT TO RISKS ASSOCIATED WITH OUR INTERNATIONAL OPERATIONS WHICH COULD
LIMIT OUR ABILITY TO EXPAND INTERNATIONALLY OR REDUCE THE REVENUES AND
PROFITABILITY OF THESE OPERATIONS.
We have significant operations in Canada and may seek to expand to
other areas outside the United States in the future. International operations
are subject to a number of risks and uncertainties, including:
o difficulties and cost associated with complying with a wide
variety of complex foreign laws, treaties and regulations;
o unexpected changes in regulatory environments;
o inadequate protection of intellectual property in foreign
countries;
o legal uncertainties, timing delays and expenses associated
with tariffs, export licenses and other trade barriers;
o difficulties enforcing agreements and collecting receivables
through foreign legal systems;
o tax rates in foreign countries that may exceed those of the
United States and foreign earnings that may be subject to
withholding requirements, tariffs or other restrictions;
o exchange controls or other limitations on international
currency movements;
o fluctuations in foreign currency exchange rates; and
o political and economic instability.
Our success will be dependent, in part, on our ability to anticipate
and effectively manage these and other risks. Any of these factors could impair
our ability to expand into international markets and could prevent us from
increasing our revenue and our profitability and meeting our growth objectives.
THE HOLDERS OF OUR OUTSTANDING SHARES OF PREFERRED STOCK HAVE RIGHTS, AND THE
HOLDERS OF ANY ADDITIONAL SHARES OF PREFERRED STOCK THAT MAY BE ISSUED BY US MAY
BE GRANTED RIGHTS THAT ARE SUPERIOR TO THE RIGHTS OF HOLDERS OF OUR COMMON
STOCK.
We currently have outstanding 150,000 shares of Series A Cumulative
Perpetual Preferred Stock, 120,000 shares of Series B Convertible Preferred
Stock and 120,000 shares of Series C Convertible Preferred Stock. These shares
of preferred stock have dividend and liquidation preferences superior to those
of the common stock, as well as specified rights in connection with mergers and
other business combination transactions in which we may be involved. In
particular, the approval of a majority of the Series A Cumulative Perpetual
Preferred Stock will be required to approve any merger or other business
combination that would result in our experiencing a change in control under the
terms of the Series A Cumulative Perpetual Preferred Stock or under Delaware law
on or before April 15, 2004.
The holders of the Series B Convertible Preferred Stock and the Series
C Convertible Preferred Stock will have the right in any business combination to
elect to receive either or a combination of the following:
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<PAGE> 18
o the stock and other securities, cash and property which the
holder would have received had the holder converted the
holder's preferred stock into shares of our common stock
immediately before the transaction;
o shares of common stock of the acquiring person or its parent
company, as elected by the holders, according to formulas
which take into account various factors, including the
acquisition price for our common stock, the conversion price
for the holder's preferred stock, the market price of the
common stock of the acquiring person or its parent and the
stated value of the holder's preferred stock; or
o cash in an amount equal to 133% of the stated value of the
holder's preferred stock, to be paid by the acquiring party or
its parent.
In addition, our Board of Directors may issue up to 610,000 additional
shares of preferred stock without further stockholder approval and with voting,
dividend or liquidation rights that could adversely affect your rights as common
stockholders. These shares of preferred stock could delay, deter or prevent a
change in control of Newpark or other corporate action. This could discourage
premium bids for our common stock.
THE MARKET PRICE OF OUR COMMON STOCK IS SUBJECT TO FLUCTUATION, AND INVESTORS
MAY NOT BE ABLE TO PREDICT THE TIMING OR EXTENT OF THESE FLUCTUATIONS.
The market price of our common stock may fluctuate depending on a
number of factors. These include the general economy, stock market conditions,
general trends in the oilfield service industry, announcements made by us or our
competitors and variations in our operating results. Investors may not be able
to predict the timing or extent of these fluctuations.
WE DO NOT PLAN TO PAY ANY DIVIDENDS ON OUR COMMON STOCK, AND INVESTORS SHOULD
NOT BUY OUR COMMON STOCK EXPECTING TO RECEIVE DIVIDENDS.
We have paid no dividends on our common stock, and we may not achieve
sufficient earnings to pay cash dividends on our common stock in the future.
Further, we intend to retain earnings to fund our operations. The indenture
governing our senior subordinated notes and our credit facility restrict our
ability to pay dividends and make other distributions. In addition, so long as
shares of our Series A Cumulative Perpetual Preferred Stock, our Series B
Convertible Preferred Stock or our Series C Convertible Preferred Stock are
outstanding, we may not pay any dividends on our common stock, except for
dividends payable solely in shares of our common stock. Therefore, we do not
anticipate paying any cash dividends on our common stock for the foreseeable
future.
FORWARD-LOOKING STATEMENTS
Some of the statements contained in or incorporated by reference in
this prospectus discuss our plans and strategies for our business or state other
forward-looking statements, as this term is defined in the Private Securities
Litigation Reform Act. The words "anticipates", "believes", "estimates",
"expects", "plans", "intends" and similar expressions are intended to identify
these forward-looking statements but are not the exclusive means of identifying
them. These forward-looking statements reflect the current views of our
management; however, various risks, uncertainties and contingencies, including
the risk factors discussed above, could cause our actual
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<PAGE> 19
results, performance or achievements to differ materially from those expressed
in, or implied by, these statements, including the success or failure of our
efforts to implement our business strategy.
We assume no obligation to update publicly any forward-looking
statements, whether as a result of new information, future events or otherwise.
In light of these risks, uncertainties and assumptions, the forward-looking
events discussed in or incorporated by reference in this prospectus might not
occur. In addition to the disclosure contained in this prospectus, you should
carefully review any disclosure of risks and uncertainties contained in other
documents we file or have filed from time to time with the Securities and
Exchange Commission according to the Securities Exchange Act of 1934.
USE OF PROCEEDS
We will not receive any proceeds from the sale of the common stock by
the selling stockholder. The selling stockholder will receive all of the net
proceeds from any sale of the shares of common stock being sold by the selling
stockholder pursuant to this prospectus. The net proceeds from the sale of the
Series C Convertible Preferred Stock have been used to repay indebtedness.
SELLING STOCKHOLDER
The 5,758,422 shares of our common stock offered by this prospectus are
being offered for the account of the selling stockholder, Fletcher
International, Ltd. These shares consist of shares of our common stock issuable
upon conversion of our Series C Convertible Preferred Stock and as dividends on
the Series C Convertible Preferred Stock within one year following the effective
date of the Registration Statement of which this prospectus is a part.
Based on the 69,641,737 shares of our common stock outstanding as of
January 12, 2001, the shares of our common stock offered by this prospectus
would represent approximately 7.64% of our outstanding shares of common stock if
issued as of that date.
We issued the Series C Convertible Preferred Stock to the selling
stockholder in a private placement transaction. We are registering the shares of
common stock issuable with respect to the Series C Convertible Preferred Stock
to permit the selling stockholder and its pledgees, donees, transferees or other
successors-in-interest that receive their shares from the selling stockholder as
a gift, distribution or other non-sale related transfer after the date of this
prospectus to resell the shares when they deem appropriate.
The holder of Series C Convertible Preferred Stock has the right to
convert all or any part of the Series C Convertible Preferred Stock into shares
of our common stock at a conversion rate based on the then-current market value
of our common stock. This market value is based on the weighted average daily
market price of our common stock over the 40 trading days ending five days
before the measurement date. However, subject to the adjustments described
below, the conversion rate will not be less than $4.3125 nor greater than the
lowest of the following: (a) $11.2125; (b) the average of the market prices of
our common stock for the first three trading days of that 40 trading day period;
or (c) the average of the market prices of our common stock for the last three
days of that 40 trading day period. With certain exceptions, if we issue any
additional shares of our common stock, or securities that are convertible into
shares of our common stock, for a total consideration, including
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<PAGE> 20
the consideration to be paid upon conversion, of less than $4.3125 per share,
the minimum conversion rate of $4.3125 will be reduced to the lower price at
which these additional securities were issued. In addition, and again with
certain exceptions, if we issue any additional shares of our common stock or
securities that are convertible into shares of our common stock with a
fluctuating purchase or conversion price, and the maximum total consideration to
be paid for these securities, including the consideration to be paid upon
conversion, is less than $11.2125 per share, the maximum conversion rate of
$11.2125 will be reduced to this lower price. However, no further adjustments to
the maximum conversion rate will be required if our common stock trades at a
price of more than $11.2125 for 30 consecutive trading days and the Registration
Statement of which this prospectus is a part is available with respect to all of
the shares of common stock issuable with respect to the Series C Convertible
Preferred Stock during that period. The minimum conversion price does not apply
to any calculations of the cash, securities or other property the selling
stockholder is entitled to receive upon a merger, asset sale, consolidation or
other business combination involving Newpark.
For purposes of any conversion, each share of Series C Convertible
Preferred Stock will have a value equal to its liquidation preference of $250
per share, plus any accrued and unpaid dividends. As of January 12, 2001, the
conversion rate was $8.1663 per share under this conversion formula.
Accordingly, the outstanding shares of Series C Convertible Preferred Stock
would be convertible into 3,673,634 shares of our common stock, plus another
6,888 shares of our common stock with respect to accrued but unpaid dividends
through that date.
Pursuant to the terms of the agreement by which the selling stockholder
acquired the Series C Convertible Preferred Stock, the shares of Series C
Convertible Preferred Stock are convertible only to the extent that the number
of shares of common stock issuable upon conversion, together with the number of
shares previously issued and issuable to the selling stockholder and its
affiliates under the agreement, and under the agreement pursuant to which an
affiliate of the selling stockholder acquired the Series B Convertible Preferred
Stock and a warrant to purchase common stock, would not exceed 6,782,337 shares
of our common stock. The selling stockholder may increase this amount to any
number 65 days after delivering a notice to us.
The following table provides certain information with respect to the
selling stockholder, including the selling stockholder's beneficial ownership of
our common stock as of January 12, 2001, and as adjusted to give effect to the
sale of the shares offered by this prospectus. The shares of common stock
offered by this prospectus may be offered from time to time by the selling
stockholder named below or its nominees.
<TABLE>
<CAPTION>
SHARES OF COMMON SHARES OF SHARES OF COMMON
STOCK OWNED COMMON STOCK STOCK OWNED
NAME PRIOR TO OFFERING(1) TO BE SOLD(2) AFTER OFFERING
---- -------------------- ------------- ----------------
<S> <C> <C> <C>
Fletcher International, Ltd......... 3,680,522 3,680,522 0
</TABLE>
----------
(1) Consists of shares of our common stock issuable upon conversion of our
Series C Convertible Preferred Stock and as dividends on the Series C
Convertible Preferred Stock as of January 12, 2001. Does not include
(a) 3,692,921 shares of our common stock issuable upon conversion of
our Series B Convertible Preferred Stock and as dividends on the Series
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<PAGE> 21
B Convertible Preferred Stock as of January 12, 2001 and (b) 1,900,000
shares of our common stock issuable upon exercise of a warrant, which
securities are owned by an affiliate of the selling stockholder.
(2) The actual number of shares of our common stock offered by this
prospectus and included in the Registration Statement of which this
prospectus is a part includes, pursuant to Rule 416 under the
Securities Act of 1933, an additional number of shares of our common
stock which may be issuable with respect to the Series C Convertible
Preferred Stock to prevent dilution resulting from stock splits, stock
dividends or other similar transactions.
The securities listed above include outstanding securities held in one
or more accounts managed by Fletcher Asset Management, Inc. ("FAM") for the
selling stockholder. FAM is an investment adviser to the selling stockholder and
is registered under Section 203 of the Investment Advisors Act of 1940, as
amended. Pursuant to an investment advisory agreement between FAM and the
selling stockholder, FAM has the authority to vote and dispose of the securities
in these accounts. By reason of the provisions of Rule 13d-3 under the
Securities Exchange Act of 1934, the selling stockholder and FAM may each be
deemed to own beneficially the securities registered under the Registration
Statement of which this prospectus is a part. In addition, by virtue of Alphonse
Fletcher, Jr.'s position as Chairman and Chief Executive Officer of FAM, Mr.
Fletcher may be deemed to have the shared power to vote or direct the vote of,
and the shared power to dispose or direct the disposition of, these securities.
Therefore, Mr. Fletcher may be deemed to be the beneficial owner of these
securities.
In the agreement pursuant to which the selling stockholder acquired the
Series C Preferred Stock, we granted the selling stockholder certain rights with
respect to the registration under the Securities Act of 1933 of the shares of
our common stock issuable with respect to those securities. The shares offered
by this prospectus are being registered pursuant to these registration rights.
If the registration statement of which this prospectus is a part is not declared
effective by March 13, 2001, the conversion price for the Series C Convertible
Preferred Stock will be permanently reduced by 2.5% for each month, or portion
of a month, after that date that the registration statement is not declared
effective. In addition, if we fail to maintain the effectiveness of the
registration statement more than twice in any twelve month period or for more
than 30 days, the conversion price for the Series C Convertible Preferred Stock
will be permanently reduced by 2.5%. Additional 2.5% reductions would be made to
the conversion price if we were to again violate this covenant in subsequent
years, and the reductions will continue in effect until twelve months have
passed without a violation of this covenant.
In accordance with the terms of these registration rights, we will pay
substantially all of the expenses of this offering, including the printing,
legal and accounting expenses we incur and the registration and filing fees
imposed by the SEC and The New York Stock Exchange. The selling stockholder will
be indemnified by us against certain liabilities, including certain liabilities
under the Securities Act of 1933, or will be entitled to contribution from us in
connection with these liabilities. We also will be indemnified by the selling
stockholder against certain liabilities, including certain liabilities under the
Securities Act of 1933, or will be entitled to contribution from the selling
stockholder in connection with these liabilities.
We have agreed to provide the selling stockholder, its affiliates and
its designees who together with the selling stockholder and its affiliates hold
at least 60,000 shares of Series C
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<PAGE> 22
Convertible Preferred Stock, with a right of first refusal with respect to any
shares of our capital stock or any securities convertible into or exchangeable
for any shares of our capital stock. This right of first refusal will be
exercisable for ten trading days after delivery of the required notice from us
to the selling stockholder. However, this right of first refusal will only
become effective at such time as the right of first refusal under the agreement
relating to the Series B Convertible Preferred Stock is of no further force or
effect. In addition, the right of first refusal will terminate when the number
of shares of common stock we are required to register under the Securities Act
of 1933 under the agreements with the selling stockholder and the holder of the
Series B Convertible Preferred Stock and related warrant is less than 3,478,169,
as that number may be adjusted for stock splits, stock dividends,
recapitalizations or other similar adjustments.
The acquisition transaction with the selling stockholder was negotiated
at arms' length. We believe that the terms of this transaction were commercially
reasonable in the circumstances. There is no affiliation, under Rule 405 of the
Securities Act of 1933, between either us and the selling stockholder or between
the selling stockholder and any of our affiliates. However, in June 2000, an
affiliate of the selling stockholder, Fletcher International Limited, purchased
from us for total consideration of $30 million 120,000 shares of our Series B
Convertible Preferred Stock and a warrant to purchase 1,900,000 shares of our
common stock at an exercise price of $10.075 per share. The securities purchased
by this affiliate also are held in one or more accounts managed by FAM, and FAM
has the authority to vote and dispose of the securities in these accounts.
PLAN OF DISTRIBUTION
The selling stockholder may sell the shares of common stock described
in this prospectus directly or through underwriters, broker-dealers or agents.
The selling stockholder may also transfer, devise or gift its shares by other
means not described in this prospectus. As a result, pledgees, donees,
transferees or other successors in interest that receive shares as a gift,
distribution or other non-sale related transfer may offer shares of common
stock. Because the selling stockholder may be deemed to be an "underwriter"
within the meaning of Section 2(11) of the Securities Act of 1933, the selling
stockholder will be subject to the prospectus delivery requirements of the
Securities Act of 1933. In addition, if any shares covered by this prospectus
qualify for sale pursuant to Rule 144 under the Securities Act of 1933, the
selling stockholder may sell those shares under Rule 144 rather than pursuant to
this prospectus.
The selling stockholder, or its pledgees, donees or other successors in
interest, may sell the shares of common stock offered by this prospectus from
time to time in one or more transactions:
o at fixed prices that may be changed;
o at market prices prevailing at the time of sale;
o at prices related to prevailing market prices or at negotiated
prices; or
o at other prices as determined by the selling stockholder from
time to time.
The selling stockholder, or its pledgees, donees or other successors in
interest, may sell the shares of common stock offered by this prospectus from
time to time in one or more of the following transactions:
21
<PAGE> 23
o on The New York Stock Exchange or any other national
securities exchange or quotation service on which the common
stock may be listed or quoted at the time of sale;
o in the over-the-counter market;
o in privately negotiated transactions;
o in an underwritten offering;
o by pledge to secure debts and other obligations;
o through block transactions;
o by a combination of the above methods of sale; or
o to cover short sales, equity swaps, options or other
derivative security or hedging transactions made pursuant to
this prospectus.
In effecting sales, brokers or dealers engaged by the selling
stockholder may arrange for other brokers or dealers to participate in the
resales. The selling stockholder may enter into hedging transactions with
broker-dealers, and in connection with those transactions, broker-dealers may
engage in short sales of the shares. The selling stockholder also may sell
shares short and deliver the shares to close out these short positions. The
selling stockholder also may enter into option or other transactions with
broker-dealers that require the delivery to the broker-dealer of the shares,
which the broker-dealer may resell pursuant to this prospectus. The selling
stockholder also may pledge the shares to a broker or dealer, and upon a
default, the broker or dealer may effect sales of the pledged shares pursuant to
this prospectus.
Broker-dealers or agents may receive compensation in the form of
commissions, discounts or concessions from the selling stockholder.
Broker-dealers or agents may also receive compensation from the purchasers of
the shares for whom they act as agents or to whom they sell as principals, or
both. Compensation as to a particular broker-dealer might be in excess of
customary commissions and will be in amounts to be negotiated in connection with
the sale. Market makers and block purchasers purchasing the shares will do so
for their own account and at their own risk. It is possible that the selling
stockholder will attempt to sell shares of common stock in block transactions to
market makers or other purchasers at a price per share which may be below the
then market price. There can be no assurance that all or any part of the shares
offered by this prospectus will be issued to, or sold by, the selling
stockholder. The selling stockholder will bear all commissions and discounts, if
any, attributable to the sales of the shares. The selling stockholder may agree
to indemnify any broker-dealer or agent that participates in transactions
involving sales of the shares against specific liabilities, including
liabilities arising under the Securities Act of 1933.
The SEC may deem the selling stockholder and any underwriters,
broker-dealers or agents that participate in the distribution of the shares of
common stock to be "underwriters" within the meaning of the Securities Act of
1933. The SEC may deem any profits on the resale of the shares of common stock
and any compensation received by any underwriter, broker-dealer or agent to be
underwriting discounts or commissions under the Securities Act of 1933.
Upon a sale of common stock pursuant to the Registration Statement of
which this prospectus forms a part, the common stock will be freely tradable in
the hands of persons other than our affiliates.
22
<PAGE> 24
Under the Securities Exchange Act of 1934, any person engaged in the
distribution of the shares of common stock may not simultaneously engage in
market-making activities with respect to the common stock for five business days
prior to the start of the distribution. In addition, the selling stockholder and
any other person participating in a distribution will be subject to the
Securities Exchange Act of 1934, which may limit the timing of purchases and
sales of common stock by the selling stockholder or any other person seeking to
sell shares.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any document we file at
the public reference facilities maintained by the SEC at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the following regional offices of
the SEC: 7 World Trade Center, Suite 1300, New York, New York 10048; and
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661.
You can obtain copies of this material from the Public Reference Room of the SEC
at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. Please
call the SEC at 1-800-SEC-0330 for further information on the public reference
rooms. Our SEC filings are also available from our website at
"http://www.newpark.com" or at the SEC's website at "http://www.sec.gov". The
information contained in our website is not a part of this prospectus and shall
not be deemed to be incorporated in this prospectus.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus, and information that we file later
with the SEC will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future filings we
will make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934:
1. Our Annual Report on Form 10-K for the year ended December 31,
1999, as amended on August 28, 2000;
2. Our Quarterly Reports on Form 10-Q for the three months ended
March 31, 2000 and June 30, 2000, as those reports were
amended on August 28, 2000, and our Quarterly Report on Form
10-Q for the three months ended September 30, 2000;
3. Our Proxy Statement for the annual meeting of stockholders
held on June 14, 2000;
4. Our Current Reports on Form 8-K dated June 1, 2000 and
December 28, 2000; and
5. The description of our common stock contained in our
Registration Statement pursuant to Section 12 of the
Securities Exchange Act of 1934, as amended from time to time.
23
<PAGE> 25
You may request a copy of these filings, at no cost, by writing or
telephoning us at the following address:
Ms. Edah Keating
Corporate Secretary
Newpark Resources, Inc.
3850 North Causeway, Suite 1770
Metairie, Louisiana 70002
(504) 838-8222
This prospectus is part of a Registration Statement we filed with the
SEC. It does not contain all the information included or incorporated by
reference in the Registration Statement. The full Registration Statement can be
obtained from the SEC as indicated above or from us. You should rely only on the
information or representations provided in this prospectus or incorporated by
reference. We have authorized no one to provide you with different information.
We are not making an offer of these securities in any state where the offer is
not permitted. You should not assume that the information in this prospectus is
accurate as of any date other than the date on the front of this document.
Unless the context requires otherwise, all references in this
prospectus to "this prospectus" include documents incorporated by reference into
this prospectus.
LEGAL MATTERS
The validity of the securities being offered by this prospectus will be
passed upon for us by Ervin, Cohen & Jessup LLP, Beverly Hills, California.
EXPERTS
Our consolidated financial statements as of December 31, 1999 and for
the year ended December 31, 1999 incorporated by reference in this prospectus
have been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their report with respect to those financial statements, and are
included in this prospectus in reliance upon the authority of Arthur Andersen
LLP as experts in accounting and auditing in giving these reports. Reference is
made to this report, which includes an explanatory paragraph with respect to a
change in the method of computing depreciation in 1999, as discussed in Note A
to the financial statements.
The consolidated financial statements as of December 31, 1998 and for
each of the two years in the period ended December 31, 1998 incorporated in this
prospectus by reference from our Annual Report on Form 10-K/A have been audited
by Deloitte & Touche LLP, independent auditors, as stated in their report, which
is incorporated herein by reference (which report expresses an unqualified
opinion and contains explanatory paragraphs relating to the change in method of
accounting for costs of start up activities as discussed in Note A and the
restatement discussed in Note D), and has been so incorporated in reliance upon
the report of Deloitte & Touche LLP given upon their authority as experts in
accounting and auditing.
24
<PAGE> 26
--------------------------------------------------------------------------------
NO ONE (INCLUDING ANY SALESMAN OR BROKER) IS AUTHORIZED TO PROVIDE ORAL OR
WRITTEN INFORMATION ABOUT THIS OFFERING THAT IS NOT INCLUDED IN THIS PROSPECTUS.
YOU MUST NOT RELY ON ANY UNAUTHORIZED INFORMATION.
----------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Prospectus Summary......................................................... 3
Risk Factors............................................................... 6
Forward Looking Statements................................................. 17
Use of Proceeds............................................................ 18
Selling Stockholder........................................................ 18
Plan of Distribution....................................................... 21
Where You Can Find More Information........................................ 23
Legal Matters.............................................................. 24
Experts.................................................................... 24
</TABLE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
[NEWPARK RESOURCES, INC. LOGO]
NEWPARK RESOURCES, INC.
5,758,422 SHARES
COMMON STOCK
($.01 PAR VALUE)
PROSPECTUS
JANUARY __, 2001
--------------------------------------------------------------------------------
<PAGE> 27
PART II - INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the estimated expenses payable by the
registrant in connection with the filing of this Form S-3 Registration
Statement. The registrant will pay all of these expenses on behalf of the
selling stockholder.
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee...... $11,387.28
Printing costs........................................... 5,000.00
Legal fees............................................... 15,000.00
Accounting fees and expenses............................. 10,000.00
Miscellaneous expenses................................... 1,000.00
----------
Total........................................... $42,387.28
==========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the General Corporation Law of the State of Delaware
(the "GCL") permits a corporation to, and the registrant's bylaws require that
it, indemnify any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
by or in the right of the corporation), by reason of the fact that he is or was
a director, officer, employee or agent of the corporation, or is or was serving
at the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred in connection with such action,
suit or proceeding if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the corporation, and,
with respect to any criminal action or proceeding, had no reasonable cause to
believe his conduct was unlawful.
As permitted under Section 145 of the GCL, the registrant's bylaws also
provide that it shall indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the corporation to procure a judgment in its favor by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation. However, in such an action by or on behalf of a corporation, no
indemnification may be made in respect of any claim, issue or matter as to which
the person is adjudged liable for negligence or misconduct in the performance of
his duty to the corporation unless, and only to the extent that the court
determines that, despite the adjudication of liability but in view of all the
circumstances, the person is fairly and reasonably entitled to indemnity for
such expenses which the court shall deem proper.
In addition, the indemnification provided by Section 145 shall not be
deemed exclusive of any other rights to which a person seeking indemnification
may be entitled under any bylaw,
II-1
<PAGE> 28
agreement, vote of stockholders or disinterested directors or otherwise, both as
to action in his official capacity and as to action in another capacity while
holding such office.
The registrant's Certificate of Incorporation (the "Certificate")
provides that the registrant shall indemnify, to the fullest extent permitted by
law, each of its officers, directors, employees and agents who was or is a party
to, or is threatened to be made a party to, any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that such person is or was a director,
officer, employee or agent of the registrant. The Certificate also provides
that, to the fullest extent permitted by law, no director of the registrant
shall be liable to the registrant or its stockholders for monetary damages for
breach of his fiduciary duty as a director.
The Certificate also provides that the registrant may purchase and
maintain insurance on behalf of any person who is or was a director, officer,
employee or agent of the registrant, or is serving at the request of the
registrant as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise
against any liability incurred by such person in any such capacity, or arising
out of his status as such, regardless of whether the registrant is empowered to
indemnify such person under the provisions of law. The registrant currently
maintains this insurance for its directors, officers, employees and agents.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(A) EXHIBITS
4.1 Form of certificate representing shares of the registrant's
common stock.(1)
4.2 Certificate of Rights and Preferences of Series C Convertible
Preferred Stock of the registrant.(2)
5.1 Opinion of Ervin, Cohen & Jessup LLP.
10.1 Agreement, dated December 27, 2000, between the registrant and
Fletcher International, Ltd.(2)
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Deloitte & Touche LLP.
23.3 Consent of Ervin, Cohen & Jessup LLP (included in Exhibit
5.1).
24.1 Powers of Attorney (set forth on Pages II-5 and II-6).
----------
(1) Incorporated by reference from the registrant's Registration Statement
on Form S-1 (File No. 33-40716).
(2) Incorporated by reference from the registrant's Current Report on Form
8-K dated December 28, 2000.
II-2
<PAGE> 29
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 of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the Registration
Statement. Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more that a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective Registration Statement; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement;
provided, however, that paragraphs (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 by the registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in this 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.
(4) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this Registration
Statement as of the time it was declared effective.
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 Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
II-3
<PAGE> 30
registration statement shall be deemed to be a new registration statement
related to the securities offered therein, and the offering of such securities
at the time shall be deemed to be the initial bona fide offering thereof.
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. If a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-4
<PAGE> 31
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 Metairie, State of Louisiana, on January 17, 2001
NEWPARK RESOURCES, INC.
By /s/ James D. Cole
----------------------------------------
James D. Cole, Chairman of the Board and
Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints James D. Cole and Matthew W.
Hardey, and each of them, as his true and lawful attorneys-in-fact and agents
with full power of substitution and resubstitution, for such person and in such
person's name, place and stead, in any and all capacities, to sign any and all
amendments (including post-effective amendments) to this registration statement,
and any related Rule 462(b) registration statement or amendment thereto, and to
file the same, with all exhibits thereto, and all 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, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or either of them, or his or their substitutes,
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/ James D. Cole Chairman of the Board and January 17, 2001
---------------------------------- Chief Executive Officer
James D. Cole
/s/ Matthew W. Hardey Vice President of Finance January 17, 2001
---------------------------------- and Chief Financial Officer
Matthew W. Hardey
/s/ Wm. Thomas Ballantine President and Director January 17, 2001
----------------------------------
Wm. Thomas Ballantine
/s/ David P. Hunt Director January 17, 2001
----------------------------------
David P. Hunt
</TABLE>
<PAGE> 32
<TABLE>
<S> <C> <C>
/s/ Alan J. Kaufman Director January 17, 2001
----------------------------------
Dr. Alan J. Kaufman
/s/ James H. Stone Director January 17, 2001
----------------------------------
James H. Stone
/s/ Roger C. Stull Director January 17, 2001
----------------------------------
Roger C. Stull
/s/ David Baldwin Director January 17, 2001
----------------------------------
David Baldwin
</TABLE>
<PAGE> 33
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<S> <C>
4.1 Form of certificate representing shares of the registrant's
common stock.(1)
4.2 Certificate of Rights and Preferences of Series C Convertible
Preferred Stock of the registrant.(2)
5.1 Opinion of Ervin, Cohen & Jessup LLP.
10.1 Agreement, dated December 27, 2000, between the registrant and
Fletcher International, Ltd.(2)
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Deloitte & Touche LLP.
23.3 Consent of Ervin, Cohen & Jessup LLP (included in Exhibit
5.1).
24.1 Powers of Attorney (set forth on Pages II-5 and II-6).
</TABLE>
----------
(1) Incorporated by reference from the registrant's Registration Statement
on Form S-1 (File No. 33-40716).
(2) Incorporated by reference from the registrant's Current Report on Form
8-K dated December 28, 2000.
