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As filed with the Securities and Exchange Commission on November 27, 2000
File No. 333-45924
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3/A
Amendment No. 1
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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IFS INTERNATIONAL HOLDINGS, INC.
(Exact name of Registrant as specified in its charter)
Delaware 13-3393646
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
Rensselaer Technology Park
300 Jordan Road
Troy, New York 12180
(518) 283-7900
(Address, including zip code, and telephone number,
including area code, of Registrant's principal executive offices)
DAVID L. HODGE, Chief Executive Officer
Rensselaer Technology Park
300 Jordan Road
Troy, New York 12180
(518) 283-7900
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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Copies to:
MICHAEL D. DIGIOVANNA, ESQ.
PARKER DURYEE ROSOFF & HAFT
529 Fifth Avenue
New York, New York 10017-4608
(212) 599-0500
Approximate date of proposed sale to the public: From time to time after the
effective date of this Registration Statement.
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<PAGE>
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [ ]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
<TABLE>
============================== ==================== =================== ======================== ==================
Proposed Maximum Proposed Maximum
Title of Each Class of Offering Price Aggregate Offering Amount of
Securities to be Registered Amount to be Per Share Price(1) Registration Fee
Registered
------------------------------ -------------------- ------------------- ------------------------ ------------------
------------------------------ -------------------- ------------------- ------------------------ ------------------
<S> <C> <C> <C> <C> <C>
Common stock, par value
$.001 per share 1,168,386 $2.25 $2,628,828 $696.63 (2)
Common stock, par value
$.001 per share 341,711 $1.75 $597,995 $158.00 (3)
Total Registration Fee $854.63
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</TABLE>
(1) The Registration Statement relates to common stock issuable upon the
exercise of warrants and conversion of preferred stock sold in a private
placement.
(2) This part of the registration statement fee was paid with the original
filing of this S-3 on September 15, 2000.
(3) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) based upon the average of the low bid and high
asked prices of the common stock on The Nasdaq SmallCap Market on November
1, 2000.
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.
<PAGE>
PROSPECTUS
1,510,097 SHARES
IFS INTERNATIONAL HOLDINGS, INC.
Common Stock
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Stockholders of IFS International Holdings, Inc., named under the caption
"Selling Stockholders" may offer and sell up to 1,510,097 shares of our common
stock.
Investing in our common stock is risky. See "Risk Factors" on page 5.
Our common stock is traded on the Nasdaq SmallCap Market under the symbol
"IFSH". The closing bid price of our common stock on November 7, 2000 was $1.75.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is November 27, 2000
<PAGE>
TABLE OF CONTENTS
Page
INTRODUCTION..............................................................3
RISK FACTORS..............................................................5
RECENT DEVELOPMENTS ......................................................9
WHERE YOU CAN FIND MORE INFORMATION.......................................10
FORWARD-LOOKING STATEMENTS................................................11
USE OF PROCEEDS...........................................................12
SELLING STOCKHOLDERS......................................................12
PLAN OF DISTRIBUTION .....................................................17
DESCRIPTION OF SECURITIES ................................................19
LEGAL MATTERS.............................................................22
EXPERTS...................................................................22
<PAGE>
INTRODUCTION
General
We are a Delaware corporation, engaged in the business of developing, marketing
and supporting software products for electronic funds transfer and retail
banking markets. These markets are served through our two wholly-owned
subsidiaries, IFS International, Inc., a New York corporation and Network
Controls International, Inc., a North Carolina corporation.
An EFT (Electronic Funds Transfer) system of a bank or other financial
institution permits the processing of transactions involving credit cards and
debit cards (e.g., ATM cards). An EFT System typically consists of one or more
of the following facilities in various configurations: automatic teller machines
, point of sale terminals, a host computer of the financial institution and
regional, national and international networks, such as MasterCard/CIRRUS, NYCE,
MAC, EUROPAY or Visa/PLUS. TPII software products primarily route and authorize
the processing of transactions through an EFT System.
Our IFS subsidiary derives revenues principally from the licensing of its family
of software products which consists of TPII, TP-CMS and PosPay. A substantial
portion of such revenues are generated by licensing through or to computer
manufacturers, which incorporate TPII, TP-CMS and PosPay software products into
a turnkey system installed at a financial institution. For our clients we
prepare functional specifications, customize and install our software products
and train the financial institution's personnel in the use of the products.
TPII is IFS' family of open architecture software products for payment card
ATM/EFTPOS terminal management, payment card authorization, domestic and
international transaction switching and management information. The product
supports magnetic stripe, Chip and Stored Value Card reloads, and utilizes
Oracle's RDBMS technology to meet customers' business requirements.
TPII software is offered in separate modules which perform different functions,
including (i) interfacing with ATMs (Automated Teller Machines), POS (Point of
Sale) terminals, a financial institution's host computer and financial networks,
(ii) updating credit and debit card information, (iii) providing stand-in
authorization for transactions when the financial institution's host computer is
not operating, (iv) computing fees for processed transactions (v) generating
reports, and (vi) processing smart card transactions. The TPII software products
are typically installed at the financial institution's main processing facility.
TPII software is also capable of managing EFT Systems that involve the "loading"
of value on smart cards. A smart card is a plastic card with an electronic chip
that acts as a small computer which can enable the holder to "load" a fixed
amount of purchasing power or cash equivalent on the card as authorized.
TP-CMS is one of IFS' newest additions to our product portfolio. TP-CMS has been
installed at its first location and is being marketed worldwide. The product is
an open architecture payment card management solution for credit, debit,
electronic purse cards and biometric identification. Incorporating the latest
technologies available for information management, TP-CMS enables IFS to provide
a complete migration of a bank's payment card systems to state-of-the-art
solutions. Presently, there are several financial institutions that have
contracted to have TP-CMS implemented by itself and in conjunction with TPII.
PosPay is a fully secure, end-to-end Internet payment solution. IFS, in
conjunction with an e-commerce payment gateway company, has developed PosPay,
which will be available to clients around the world. PosPay is being developed
for use in electronic payments to the banking system via the Internet. PosPay is
also being developed to handle high volume e-commerce transactions and also to
provide banking standard security via the Internet.
As a result of our acquisition of Global Insight Group, Ltd., we now provide a
business consulting division as well as a specialized training division offering
both in-house and external training courses to the financial industry.
The Global Insight Group is a supplier of quality business and technical support
services to the Card Payment Industry. This includes strategic consultancy,
software selection, implementation and development services plus training. The
group consists of three divisions, Card Insight, Resource Insight and Training
Insight, each with their own specialized service offerings. These can be
combined and/or tailored to meet the requirements of a specific project.
NCI provides bank platform automation and networking solutions to large
financial institutions worldwide. NCI released its newest product line, NCI
Business Centre(TM), in August 1999 with pilot implementations at two US banks.
NCI Business Centre(TM) is an all web and browser-based solution that provides a
single application and technology to automate business functions across any
business channel in a bank, namely CRM, teller, platform sales and service, call
center, and Internet banking. Cost of ownership, reusability of business
functions across multiple channels, and a single technology for both Intranet
and Internet based networks are several of the advantages we believe customers
achieve with NCI's innovative application solution, combined with Microsoft
Windows DNA-fs technologies. Since this product's initial release, NCI has
developed a comprehensive, customer relationship management extension and this
is now being actively marketed. .
We were incorporated in Delaware in September 1986 under the name Wellsway
Ventures, Inc. Wellsway subsequently changed its name to IFS International,
Inc., and has again recently changed its name to IFS International Holdings,
Inc. The Company's principal offices are located at Rensselaer Technology Park,
300 Jordan Road, Troy, New York, 12180 and its telephone number is (518)
283-7900.
RISK FACTORS
Each prospective investor should carefully consider the following risk factors,
as well as all other information set forth elsewhere in this Prospectus.
We have incurred operating losses and may incur losses in the future.
For the fiscal years ended, April 30, 2000 and April 30, 1999, we had a net
income of $36,176 and a net loss of $703,907 respectively. We incurred a net
loss of $786,139 for the three months ended July 31, 2000. As of July 31, 2000,
we had an accumulated deficit of $5,333,804. There can be no assurance as to our
future profitability.
We are dependent on revenues from foreign sources and are subject to the risks
of doing business abroad.
We derived approximately 81% and 82% of total revenues for the fiscal years
ended April 30, 2000 and 1999, respectively, from the licensing of software
products to customers outside the United States. We derived approximately 61% of
total revenues for the three months ended July 31, 2000 from the licensing of
software products to customers outside the United States. Foreign revenues
generally are subject to certain risks, including collection of accounts
receivable, compliance with foreign regulatory requirements, variability of
foreign economic conditions and changing restrictions imposed by United States
export laws. To date, all foreign customers have paid us in United States
currency, but if future customers pay in foreign currencies, we would be subject
to fluctuations in exchange rates. There can be no assurance that we will be
able to continue to manage the risks related to selling our products and
services in foreign markets.
We are dependent on the electronic funds transfer, payment cards, internet
payment and the bank automation markets.
We derive our revenues from sales to the electronic funds transfer, pre-pay,
payment cards, internet payment and the bank automation markets. Therefore, we
are susceptible to adverse events in these markets. For example, a decrease in
spending by organizations for software in the above named markets could result
in a smaller overall market for our software. This factor, as well as others
negatively affecting the above named markets, could have a material adverse
effect on our financial condition and results of operations.
We may be unable to grow and maintain our revenues if we have a need for
additional financing in the future, and are not able to obtain required funds.
We believe that anticipated cash flow from operations, recently received
proceeds from our sale of preferred shares and the $600,000 line of credit
available to us will be sufficient to finance our operating working capital
requirements for the foreseeable future.
Our estimate is based upon our ability to obtain revenues from licensing
agreements through our operating subsidiaries, as currently projected. We may
need additional financing if these revenues are not received. Moreover, a
portion of TPII software contracts are not paid until acceptance by the
customer. As a result, we are required to fund a portion of the costs of these
installations from available capital. Any substantial increase in the number of
installations or delay in payment could create a need for additional financing.
Moreover, we may need additional financing if we underestimate any new
development projects or new business. In these events, there can be no assurance
that additional financing will be available on terms acceptable to us or at all.
Our common stock price may decline and shareholders' percentage interest may be
reduced as a result of the conversion of our outstanding convertible notes,
Series 2000 preferred stock and Series B preferred stock.
We have convertible notes outstanding with a remaining principal amount of
$825,000 and have recently issued 200,000 shares of Series B convertible
preferred stock. $250,000 of the convertible notes and related interest were
recently converted into 130,905 shares of our common stock. The conversion of
the remaining notes and the Series B preferred stock into common stock may
result in substantial dilution and a reduction in the market price of our common
stock. The notes may be converted into shares of common stock at a price equal
to the lesser of (1) $3.00 per share or (2) 90% of market price as determined in
the agreement. Each share of the Series B preferred stock is convertible into
shares of common stock calculated by dividing ten dollars ($10.00), by the lower
of $5.44 or 90% of the then market value through March 23, 2001 (82%
thereafter). Because the number of shares issued under the note and the Series B
preferred stock is dependent upon our market price, the lower the market price,
the greater the number of shares that may be issued. The conversion of a
significant number of convertible notes or Series B preferred shares may depress
the price of our common stock. This in turn would result in a lower conversion
price and a greater number of shares issued upon a subsequent conversion leading
to possible further price declines and the issuance of a significant number of
shares of common stock. We have set forth the approximate number of our shares
of common stock issuable upon conversion at the average market price of $1.828
on November 6, 2000 in separate tables for each of the notes and Series B
preferred stock and at lower market prices, assuming in each case, all of the
securities are exercised:
Number of Shares issuable
Market Price upon conversion of notes
$1.828 (current) 501,459
$1.371 (25% decline) 668,612
$0.457(75% decline) 2,005,835
<TABLE>
Number of Shares issuable Number of Shares issuable
upon conversion of Series B upon conversion of Series B
Market Price preferred stock through 3/23/2001 preferred stock after 3/23/2001
<S> <C> <C>
$ 1.828 (current) 1,215,658 1,334,258
$ 1.371 (25% decline) 1,620,877 1,779,011
$ 0.457 (75% decline) 4,862,631 5,337,034
</TABLE>
The market price of our common stock could decline as a result of the issuance
of common shares pursuant to warrants, options and other rights.
As of this date, including our public warrants, there were options and warrants
outstanding to purchase an aggregate of 8,305,956 shares of common stock with
exercise prices ranging from $1.00 to $15.00 per share. This does not include
the obligation to issue shares of our common stock pursuant to convertible
promissory notes and convertible preferred stock as described in the preceding
risk factor. In addition, we may be obligated to issue a substantial number of
shares based on the financial performance of Global Insight Group through fiscal
year 2002 pursuant to existing merger agreements. A substantial portion of our
warrants, are also subject to anti-dilution provisions, which will result in a
substantial issuance of a number of additional shares of common stock. The
issuance of all these shares could have an adverse impact upon the market price
of our common stock.
Our acquisition strategy involves numerous risks and challenges which may result
in dilution and possible losses.
We have expanded and will seek to continue to expand our operations through the
acquisition of additional businesses that complement our core skills and have
the potential to increase our overall value. Our future growth may depend, in
part, upon the continued success of our acquisition strategy. We may not be able
to successfully identify and acquire, on favorable terms, compatible businesses.
Acquisitions involve many risks, which could have a material adverse effect on
our business, financial condition and results of operations, including: acquired
businesses may not achieve anticipated revenues, earnings or cash flow;
integration of acquired businesses and technologies may not be successful and we
may not realize anticipated economic, operational and other benefits in a timely
manner, particularly if we acquire a business in a market in which we have a
limited or no current expertise; potential dilutive effect on our stockholders
from continued issuance of common stock as consideration for acquisitions;
adverse effect on net income of amortization expense related to goodwill and
other intangible assets and other acquisition-related charges, and disruption of
our existing business, distraction of management and other resources and
difficulty in maintaining our current business standards, controls and
procedures.
We are presently involved in litigation and claims which could result in
substantial losses and cash payment.
We are involved in defending two claims for amounts in excess of $2,500,000 in
the aggregate. We intend to defend these claims vigorously, as management
believes that both claims lack merit. If we were to lose these actions the
payment of the claims could result in an adverse effect on both our liquidity
and our net income.
Our revenues may decline if we do not expand our customer base.
We receive additional revenues from existing customers as a result of providing
ongoing maintenance services in support of licensed software. We may also
receive additional revenues for enhancements of the software products. We
generally will not receive significant license revenues in a subsequent period
from these customers. Although we usually generate significant repeat business
from our customers, we will still be required to continually attract new
customers in order to increase revenues in the future. As a result, we will
incur higher marketing expenses generally associated with attracting new
customers as compared to marketing expenses associated with attracting
additional business from existing customers. Moreover, our inability to generate
additional business upon completion of existing contracts would also have a
material adverse effect on our financial condition and results of operations.
Our common stock price may fluctuate because we may experience significant
fluctuation in quarterly revenues and operating results.
Quarterly revenues and operating results have fluctuated and will continue to
fluctuate as a result of a variety of factors. Our IFS subsidiary may experience
long delays (i.e., between three to twelve months) before a customer executes a
software licensing agreement.
These delays are primarily due to extended periods of software evaluation,
contract review and the selection of the computer system. In addition, following
execution of the agreement, the preparation of functional specifications,
customization and installation of software products and the training by our
subsidiary of the financial institution's personnel in the use of the software
products take an average of six to twelve months. Accordingly, our revenues may
fluctuate dramatically from one quarter to another, making quarterly comparisons
extremely difficult and not necessarily indicative of any trend or pattern for
the year as a whole. Additional factors effecting quarterly results include the
timing of revenue recognition of advance payments of license fees, the timing of
the hiring or loss of personnel, capital expenditures, operating expenses and
other costs relating to the expansion of operations, general economic conditions
and acceptance and use of electronic funds transfer.
We may not be able to compete against our competitors, many of whom have greater
resources.
The development and marketing of software for financial institutions is highly
competitive. Many of our competitors have greater financial resources than we
do. However, we believe our current products will continue to be competitive
based on cost, scalability and technology. The TPII, TP-CMS and PosPay software
products face strong competition from proprietary (legacy) and UNIX-based
software. We are unable to predict which technology, if any, will become the
industry standard.
NCI has limited direct competition with most of its legacy products as we are
unaware of any equivalent products offered by competitors. There are several
competitors for NCI's other products. The NCI Business Centre a product competes
with major branch automation solution providers.
If the technology of the financial industry changes, our products may become
obsolete.
The market for software in general is characterized by rapid changes in computer
and software technology and is highly competitive with respect to the need for
timely product innovation and new product introductions. If, for example, the
UNIX operating system were no longer a significant operating system, we would be
adversely affected if we could not adapt TPII software products to whatever
operating system becomes dominant. We believe that our future success, of which
there can be no assurance, depends upon our success in enhancing the performance
of our current TPII software products, such as the ability for TPII to handle
higher volumes of card transactions and the adaptation of our software products
to smart card technology, and developing new software products that address the
increasingly complex needs of customers.
Our revenues may decline if our proprietary rights do not prevent others from
using our technology.
We rely on a combination of trade secret and copyright laws, non-disclosure and
other contractual and technical measures to protect our proprietary rights in
our software products. There can be no assurance that these provisions will be
adequate to protect such proprietary rights. In addition, the laws of certain
foreign countries do not protect intellectual property rights to the same extent
as the laws of the United States. If our proprietary rights do not prevent
others from using our technology, then we may face additional competition, and
our revenues may decline. Although we believe that our intellectual property
rights do not infringe upon the proprietary rights of third parties, there can
be no assurance that third parties will not assert infringement claims against
us.
RECENT DEVELOPMENTS
We are presently conducting a private placement of our securities that commenced
in August 2000, and may be extended to December 2000.
<PAGE>
The placement includes units of our securities consisting of one share of a
newly authorized convertible preferred stock and a warrant to purchase one share
of common stock. An aggregate of 4,000,000 units are being offered at a price of
$2.50 per unit or total of $10,000,000 if all the units are purchased. As of
November 6, 2000, 663,994 units were purchased and we received gross proceeds of
$1,659,985. We are required to issue warrants to the placement agent to acquire
a number of units equal to 15% of the units sold pursuant to the offering.
In September 2000, we issued 585,511 shares of our common stock to Per Olof
Ezelius, one of our directors and President and CEO of Network Controls
International, Inc. The shares were issued as additional contingent
consideration pursuant to the terms of a Plan and Merger Agreement dated January
30, 1998. The number of shares was in excess of the number of shares Mr. Ezelius
would otherwise been entitled to receive. The consideration for such additional
shares was the surrender by Mr. Ezelius of all rights to receive additional
shares pursuant to the Plan and Merger Agreement and related agreements.
In July 2000, agreements with our executives were amended to eliminate
substantial bonuses to these executives upon a change of control. The
agreements, as amended, never the less, provide for payments if these executives
elect to terminate their agreements upon a change of control or breach of
agreement by the Company as well as termination by the Company without cause. In
these circumstances the Company incurs a substantial obligation to the
executives for its actions. These include payment to executives in a lump sum,
without discount to present value, for the greater of the balance of the term or
24 months (a) the executive's annual salary or fees and (b) in the case of
Messr. Hodge and Theobald their annual bonus shall be calculated at 80% and 40%
of Messrs. Hodge and Theobald's salary for the twelve months prior to
termination. Payments are to be grossed up to cover tax payments. All options
and SARs granted or obligated to be granted will be accelerated and payments for
the exercise price of the options shall be advanced by the Company.
WHERE YOU CAN FIND MORE INFORMATION
IFS has filed a registration statement on Form S-3 with the Securities and
Exchange Commission in connection with this offering. In addition, IFS files
annual, quarterly and current reports, proxy statements and other information
with the Securities and Exchange Commission. You may read and copy the
registration statement and any other documents filed by IFS at the Securities
and Exchange Commission's Public Reference Room at 450 Fifth Street, N.W.,
Washington, D.C. 20549. Please call the Securities and Exchange Commission at
1-800-SEC-0330 for further information on the Public Reference Room.
IFS' Securities and Exchange Commission filings are also available to the public
at the Securities and Exchange Commission's Internet site at
"http//www.sec.gov."
<PAGE>
In addition, reports, proxy statements and other information concerning IFS may
be inspected at the offices of the Nasdaq SmallCap Market, 1735 K Street, N.W.,
Washington, D.C. 20549, on which the common stock is quoted.
This prospectus is part of the registration statement and does not contain all
of the information included in the registration statement. Whenever a reference
is made in this prospectus to any contract or other document of IFS, the
reference may not be complete and you should refer to the exhibits that are a
part of the registration statement for a copy of the contract or document.
The Securities and Exchange Commission allows us to "incorporate by reference"
into this prospectus the information we file with it, which means that we can
disclose important information to you by referring you to those documents.
Information incorporated by reference is part of this prospectus. Later
information filed with the Securities and Exchange Commission will update and
supersede this information.
IFS incorporates by reference the documents listed below and any future filing
made with the Securities and Exchange Commission under Sections 13(a), 13(c), 14
or 15(d) of the Securities Exchange Act of 1934 until this offering is
completed:
Annual Report on Form 10-KSB for the fiscal year ending April 30, 2000
Annual Report on Form 10-KSB/A for the fiscal year ending April 30, 2000
Quarterly Report on Form 10-QSB for quarter ending July 31, 2000
Quarterly Report on Form 10-QSB/A for quarter ending July 31, 2000
You may request a copy of these filings, at no cost, by contacting the Company
at:
IFS International Holdings, Inc.
Rensselaer Technology Park
300 Jordan Road
Troy, New York 12180
Attn.: Carmen Pascuito
Tel. No. 518-283-7900
FORWARD-LOOKING STATEMENTS
Some of the information in this prospectus and in the information incorporated
by reference contains forward-looking statements within the meaning of the
federal securities laws. These statements include, among others, the following:
o Those pertaining to the implementation of our growth strategy; o Our projected
capital expenditures.
These statements may be found in this prospectus and in the information
incorporated by reference under "Risk Factors", "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and "Business" of our
Securities and Exchange Commission File.
<PAGE>
Forward-looking statements typically are identified by use of terms such as
"may," "will," "expect," "anticipate," "estimate," and similar words, although
some forward-looking statements are expressed differently. You should be aware
that our actual results could differ materially from those contained in
forward-looking statements due to a number of factors including:
o general economic conditions;
o competitive market influences;
o the development of the capacity to accommodate additional and larger
contracts;
o establishing the ability of TPII software products to process transactions
for larger electronic funds transfer systems;
o continued acceptance of our software products by a significant number of
new customers;
o our continued relationship with computer manufacturers; and
o acceptance of NCI Business Centre(TM)a by a significant number of new
customers.
o integration and success of acquisitions.
You should also consider carefully the statements under "Risk Factors" and other
sections of this prospectus, which address additional factors that could cause
our actual results to differ from those set forth in the forward-looking
statements.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the shares hereby. Any
proceeds received upon exercise of warrants will be utilized as working capital.
SELLING STOCKHOLDERS
Purchase by Selling Stockholders
All of the selling stockholders except one described below were purchasers of
units in a private placement in which Allen Capital Markets, LLCacted as the
placement agent. Each Unit consists of one share of Series 2000-1 Preferred
Stock, each convertible into shares of the Company's Common Stock based on a
conversion formula, and, at each closing date, based on an initial conversion
price of $2.50 per share, and one warrant, subject to a cashless exercise right,
to purchase a number of shares of the Company's Common Stock determined on the
conversion formula described below, and, at each closing date, based on an
initial exercise price of $2.50 per share. The Company has sold 663,994 Units
for a total of $1,659,985. The preferred stock of the Units sold are convertible
into an aggregate of 638,520 shares of the Company's Common Stock and the
warrants of the Units sold are exercisable into an aggregate of 638,520 shares
of the Company's Common Stock.
<PAGE>
In addition, Allen Capital Markets LLC received Units to acquire a total of
191,556 shares of the Company's Common Stock as compensation for its role as
placement agent.
On October 9, 1999, we entered into an agreement with one of the selling
stockholders. Pursuant to the agreement, we issued a warrant described below to
purchase 41,500 shares of our common stock.
The purpose of the agreement was for the selling stockholder to act as an agent
of ours to assist us in securing financing to support our sales & marketing and
research and development initiatives. The selling stockholder was successful in
finding the placement agent named above.
The warrant is exercisable for a three-year period. The exercise price is $1.80
per share.
Securities Acquired by Selling Stockholders
The Series 2000-1 Preferred Stock and Warrants received by the selling
stockholders are described below.
Series 2000-1 Preferred Stock
Upon liquidation, the Series 2000-1 Preferred Stock has a preference of $2.50
per share. This amount plus the liquidation preferences of the Series B
Convertible Preferred Stock must be paid before any distributions to holders of
junior securities. If the assets of the Company upon liquidation are
insufficient to pay the entire liquidation preference of the Series 2000-1
Preferred Stock and the Series B Preferred Stock then holders of Series 2000-1
Preferred Stock shall receive a pro-rata portion of the assets available for
distribution in the same proportion as the liquidation preference of the Series
2000-1 Preferred Stock bears to the aggregate liquidation preference of both
series.
Each share of the Series 2000-1 Preferred Stock is convertible into a number of
shares of our Common Stock as determined at each Closing based on the following
conversion formula (the "Conversion Formula"): (i) $2.50 divided by (ii) the
market closing price of the Company's Common Stock one day prior to each
Closing, plus $.125, at any time, at the option of the holder, subject to a
market closing price floor of $2.25 per share. For instance, if at a specific
closing, the prior day's market closing price of the Company's Common Stock is
$2.25, each share of the Series 2000-1 Preferred Stock would convert into 1.05
shares of Common Stock based on the following Conversion Formula: $2.50/($2.25 +
$.125). Alternatively, if, at a specific closing, the prior day's market closing
price of the Company's Common Stock is $2.75, each share of the Series 2000-1
Preferred Stock would convert into 0.87 shares of Common Stock based on the
following Conversion Formula: $2.50/($2.75 + $.125).
<PAGE>
The number of shares are subject to adjustment for fundamental corporate
changes. The shares are not redeemable for the first three years after the Final
Closing. Thereafter, they are redeemable at $2.50 per share upon 30 days notice
during which period the shares may be convertible into shares of common stock.
The holders of the Series 2000-1 Preferred Stock have no voting rights except as
otherwise provided by Delaware law or with respect to any matter which may
adversely effect the rights of holder Series 2000-1 Preferred Stock. We may not
issue any shares senior to the Series 2000-1 Preferred Stock. Dividends will be
payable when, as and if declared by our Board of Directors, No dividends will
accrue unless declared by our Board of Directors. The shares of Series 2000-1
Preferred Stock will be issued in sub-series. The only variation between the
different sub-series will be the conversion price, as determined by the closing
price at each Closing, as set forth above.
Each Warrant entitles the holder thereof to purchase, at any time until five
years commencing six months after the Final Closing, subject to certain
adjustments referred to below, a number of shares of our Common Stock determined
by the Conversion Formula described above, at each Closing. The holder of any
Warrant may exercise such Warrant by surrendering the Warrant to the Company,
with the notice of exercise properly completed and executed, together with
payment of the exercise price. The Warrants may be exercised at any time in
whole or in part at the applicable exercise price until expiration of the
Warrants. No fractional shares will be issued upon the exercise of the Warrants.
The Warrants may also be exercised at any time by presentation and surrender of
this Warrant to the Company at its principal executive offices with a written
notice of the holder's intention to effect a cashless exercise. In the event of
a cashless exercise, in lieu of paying the exercise price in cash, the holder
shall surrender the Warrant for that number of shares of Common Stock determined
by multiplying the number of Warrant shares to which it would otherwise be
entitled by a fraction, the numerator of which shall be the difference, but not
less than zero between the then current market price per share of the Common
Stock and the exercise price, and the denominator of which shall be the then
current market price per share of Common Stock.
Information Concerning Selling Stockholders
The following table contains information concerning the beneficial ownership of
our common stock by the selling stockholders as adjusted for sales by each
selling stockholder.
<TABLE>
-----Before the Offering----- -----After the Offering------
------------------------------------- --------------- ---------------- ----------- --------------- -----------------
Identity of Shares Percent of Shares Shares Percent
Stockholder or Group Beneficially Shares Offered Beneficially of
Owned Outstanding Owned Shares
Outstanding
------------------------------------ --------------- ---------------- ----------- --------------- -----------------
<S> <C> <C> <C> <C>
S&C Trust 10,667 0.2% 10,667 None -0-
Gerald & Sharon A. Shaltz, Trustees 3,556 0.1% 3,556 None -0-
Gerald & Sharon A. Shaltz, Trustees 7,111 0.1% 7,111 None -0-
Wendell Shultz 28,444 0.4% 28,444 None -0-
Brenda Cooper 5,333 0.1% 5,333 None -0-
Robert DeMilo Jr. & Linda DeMilo 28,444 0.4% 28,444 None -0-
Harold & Malvine Blinder 17,778 0.3% 17,778 None -0-
Helene Blinder 177,778 2.8% 177,778 None -0-
Sharon C. Lewis 17,778 0.3% 17,778 None -0-
Albert Antebi 4,444 0.1% 4,444 None -0-
John Antebi 4,444 0.1% 4,444 None -0-
Kenneth Lauricella FBO James
Lauricella 7,111 0.1% 7,111 None -0-
Kenneth Lauricella 7,111 0.1% 7,111 None -0-
Steven Caspi 106,667 1.7% 106,667 None -0-
Milton & Rhonda Kaufman 7,111 0.1% 7,111 None -0-
Kenneth Lauricella FBO John
Lauricella 7,111 0.1% 7,111 None -0-
Manheimer Brokerage Corporation
Employee Pension 17,778 0.3% 17,778 None -0-
Gary D. May 17,778 0.3% 17,778 None -0-
Salvatore Sorbara 17,778 0.3% 17,778 None -0-
Society of Descendants of Norman Fox 17,778 0.3% 17,778 None -0-
Beverly Edmiston 20,000 0.3% 20,000 None -0-
John & Lina Nasso 20,000 0.3% 20,000 None -0-
Elizabeth Caspi 24,000 0.4% 24,000 None -0-
Richard Scalesse 8,000 0.1% 8,000 None -0-
Aaron Klein 20,000 0.3% 20,000 None -0-
David Pierce 12,000 0.2% 12,000 None -0-
Joseph Sperandeo Jr. 8,000 0.1% 8,000 None -0-
David Auerback 7,988 0.1% 7,988 None -0-
Patrick Conroy 4,000 0.1% 4,000 None -0-
A.W. England IV 20,000 0.3% 20,000 None -0-
Ronald Rawlinson 20,000 0.3% 20,000 None -0-
</TABLE>
<PAGE>
<TABLE>
-----Before the Offering----- -----After the Offering------
-------------------------------------- --------------- ---------------- ----------- -------------- -----------------
Identity of Shares Percent of Shares Shares Percent
Stockholder or Group Beneficially Shares Offered Beneficially Of Shares
Owned Outstanding Owned Outstanding
-------------------------------------- --------------- ---------------- ----------- -------------- -----------------
<S> <C> <C> <C> <C>
Leonard Zinni 8,000 0.1% 8,000 None -0-
Zealous Partners LLC 124,000 2.0% 124,000 None -0-
Zeal Aggressive Partners LP 20,000 0.3% 20,000 None -0-
Zodiac Investment Partners LP 16,000 0.3% 16,000 None -0-
Hassan M. Abdou 12,000 0.2% 12,000 None -0-
Michael F. Rolla 40,000 0.6% 40,000 None -0-
John A. Albers MD & Philip Ortho &
Sports U/A DTD FBO John A. Albers 20,000 0.3% 20,000 None -0-
Joe V. Kilpatrick 20,000 0.3% 20,000 None -0-
Lisa L. Rainsberger & Ellis D. 12,000 0.2% 12,000 None -0-
Rainsberger Jr. Ten/Com
Frank J. Remar TTEE Frank J. Remar 12,000 0.2% 12,000 None -0-
Trust U/A DTD 3/2/93
Joseph C. Farray 16,000 0.3% 16,000 None -0-
Dannon Limited 40,000 0.6% 40,000 None -0-
Allen Capital Markets LLC 191,556 3.0% 191,556 None -0-
Arthur J. Armbrust Jr. & Barbara
Ione Armbrust Joint Tenants 10,526 0.2% 10,526 None -0-
Michael Devon & Lauri Devon Living
Trust DTD 12/26/89 21,053 0.3% 21,053 None -0-
DMMK LLC c/o Donn Turner 21,053 0.3% 21,053 None -0-
Al & Joanne Gluck 21,053 0.3% 21,053 None -0-
Kay S. Silverman Revocable Living
Trust DTD 9/11/96 Kay S. Silverman
TTEE 33,684 0.5% 33,684 None -0-
Monte E. Golditch 10,526 0.2% 10,526 None -0-
William B. Henry Jr. 21,053 0.3% 21,053 None -0-
James & Kathleen Hodge 21,053 0.3% 21,053 None -0-
Robert Walter Holzwarth & Lynda
Holzwarth Joint Tenants 10,526 0.2% 10,526 None -0-
Tae Kwi Kim 8,421 0.1% 8,421 None -0-
Scott Michel 21,053 0.3% 21,053 None -0-
Steven M. Nelson 21,053 0.3% 21,053 None -0-
Dale E. Horn 8,421 0.1% 8,421 None -0-
DB Alex Brown LLC Cust FBO Mishawn
Nelson IRA 10,526 0.2% 10,526 None -0-
DB Alex Brown LLC Cust FBO Steven M.
Nelson IRA 10,526 0.2% 10,526 None -0-
Robert Burwick 41,500 0.6% 41,500 None -0-
James Henry White TTEE Trust DTD
4/13/98 10,526 0.2% 10,526 None -0-
</TABLE>
<PAGE>
PLAN OF DISTRIBUTION
Sale of the shares may be made from time to time by the selling stockholders, or
subject to applicable law, by pledgees, donees, distributees, transferees or
other successors in interest. These sales may be made:
o on the over-the-counter market
o on foreign securities exchange
o in privately negotiated transactions or otherwise
o in a combination of transactions at prices and terms then prevailing
o at prices related to the then current market price
o at privately negotiated prices
In addition, any shares covered by this prospectus which qualify for sale
pursuant to Section 4(1) of the Securities Act or Rule 144 promulgated
thereunder may be sold under such provisions rather than pursuant to this
Prospectus. Without limiting the generality of the foregoing, the shares may be
sold in one or more of the following types of transactions.
o A block trade in which the broker-dealer so engaged will attempt to sell
the shares as agent but may position and resell a portion of the block as
principal to facilitate the transaction purchases by a broker or dealer as
principal and resale by such broker or dealer for its account pursuant to
this Prospectus;
o an exchange distribution in accordance with the rules of such exchange;
o ordinary brokerage transactions and transactions in which the broker
solicits purchasers; and
o face to face transactions between sellers and purchasers without a broker
dealer. In effecting sales, brokers or dealers engaged by the selling
stockholders may arrange for other brokers or dealers to participate in the
resales.
In connection with such transactions, broker-dealers may engage in short sales
of the shares registered hereunder in the course of hedging the positions they
assume with the selling stockholders. The selling stockholders may also sell
shares short and deliver the shares to close out such short positions. However,
they may not do so for a short position created prior to the date of this
prospectus because such a transaction may be deemed a sale of registered
securities.
<PAGE>
The selling stockholders may also enter into option or other transactions with
broker dealers which require the delivery to the broker-dealer of the shares
registered hereunder, which the broker-dealer may resell pursuant to this
prospectus. The selling stockholders may also pledge the shares registered
hereunder to a broker or dealer and upon a default, the broker or dealer may
effect sales of the pledged shares pursuant to this prospectus.
Brokers, dealers or agents may receive compensation in the form of commissions,
discounts or concessions from the selling stockholders in amounts to be
negotiated in connection with the sale.
These brokers or dealers and any other participating brokers or dealers may be
deemed to be "underwriters" within the meaning of the Securities Act in
connection with such sales and any such commission, discount or concession may
be deemed to be underwriting discounts or commissions under the Securities Act.
Information as to whether underwriters who may be selected by the selling
stockholders, or any other broker-dealer, is acting as principal or agent for
the selling stockholders, the compensation to be received by underwriters who
may be selected by the selling stockholders, or any broker-dealer, acting as
principal or agent for the selling stockholders and the compensation to be
received by other broker-dealers, in the event the compensation of such other
broker-dealers is in excess of usual and customary commissions, will, to the
extent required, be set forth in a supplement to this prospectus. Any dealer or
broker participating in any distribution of the shares may be required to
deliver a copy of this prospectus, including a prospectus supplement, if any, to
any person who purchasers any of the shares from or through such dealer or
broker.
Each of the selling shareholders has executed an agreement pursuant to which
they confirm the method of distribution set forth herein, agree not to sell the
shares if the registration statement is not current.
We have advised the selling stockholders that if at any time, they are engaged
in a distribution of the shares they are required to comply with Regulation M
promulgated under the Exchange Act. The selling shareholders have acknowledged
such advice by separate agreement and agree therein to comply with such
regulation. In general, Regulation M precludes the selling stockholders, any
affiliated purchasers and any broker-dealer or other person who participates in
such distribution from bidding for or purchasing or attempting to induce any
person to bid for or purchase any security which is the subject of the
distribution until the entire distribution is complete. A "distribution" is
defined in the rules as an offering of securities that is distinguished from
ordinary trading activities and depends on the "magnitude of the offering and
the presence of special selling efforts and selling methods". Regulation M also
prohibits any bids or purchases made in order to stabilize the price of a
security in connection with the distribution of that security.
<PAGE>
DESCRIPTION OF SECURITIES
The following descriptions of our securities are qualified in all respects by
reference to our certificate of incorporation and by-laws. Our Certificate of
Incorporation authorizes us to issue up to 50,000,000 shares of common stock,
par value $.001 per share, and 25,000,000 shares of preferred stock, par value
$.001 per share.
Common Stock
As of the date hereof, there were 4,875,325 shares of our common stock
outstanding. The holders of common stock are entitled to one vote for each share
held of record on all matters submitted to a vote of the stockholders. Subject
to preferential rights with respect to future outstanding preferred stock,
holders of common stock are entitled to receive ratably such dividends as may be
declared by the board of directors out of funds legally available therefore.
In the event of our liquidation, dissolution or winding up, holders of common
stock are entitled to share ratably in all assets remaining after payment of
liabilities and satisfaction of preferential rights and have no rights to
convert their common stock into any other securities. All shares of common stock
have equal, non-cumulative voting rights, and have no preference, exchange,
preemptive or redemption rights.
Preferred Stock
We have authority to issue 25,000,000 shares of preferred stock. Our board of
directors may issue the authorized preferred stock in one or more series and to
fix the number of shares of each series of preferred stock. The board of
directors also has the authority to set the voting powers, designations,
preferences and relative, participating, optional or other special rights of
each series of preferred stock, including the dividend rights, dividend rate,
terms of redemption, redemption price or prices, conversion and voting rights
and liquidation preferences. Preferred stock can be issued and its terms set by
the board of directors without any further vote or action by our stockholders.
In March 2000 we authorized and issued 200,000 shares of Series B 5% Convertible
Preferred Stock.
Series B Preferred Stock
The Company has authorized and issued 200,000 shares of its Series B preferred
stock having the terms set forth below;
o Liquidation Preferences. Upon liquidation the Series B preferred stock has
a preference of $11.50 per share plus the amount of accrued and unpaid
dividends before any distributions to holders of junior securities. At the
election of the holders of Series B preferred stock certain changes
relating to us may be deemed to be a liquidation for the purposes of Series
B preferred stock entitling the holder to receive an amounts equal to the
liquidator preference. These changes include a merger in which we are not
the survivor or a transaction in which 50% of the voting power of IFS is
disposed of.
o Dividends. Each holder is entitled to receive a $.50 per annum dividend
payable in quarterly installments as declared by the board of directors out
of funds legally available thereof. We may issue shares at market value in
lieu of a cash.
o Conversion. Each share of the preferred stock is convertible into shares of
common stock calculated by dividing ten dollars ($10.00), by the lower of
$5.44 or 90% of the then market value through March 23, 2001 (82%
thereafter). If the Company's shares are not listed on NASDAQ then the
shares are convertible at the lower of $5.44 or 65% of current market.
o Redemption. Provided our market price is $7.00 or greater we may redeem the
Series B preferred stock at $6.00 per share until December 24, 2000 and
thereafter at $6.25 per share plus accrued dividends.
o Voting rights. The holder of the Series B preferred stock have no rights
except as otherwise provided by Delaware law or with respect to any matter
which may adversely effect the rights of holder Series B preferred stock.
o Additional Rights. We may not issue any shares senior to the Series B
preferred stock.
Series 2000-1 Preferred Stock
We have also recently authorized 6,500,000 shares of Series 2000-1 preferred
stock. Upon liquidation, the Series 2000-1 preferred stock has a preference of
$2.50 per share. This amount plus the liquidation preferences of the Series B
Convertible preferred stock must be paid before any distributions to holders of
junior securities.
If the assets of the Company upon liquidation are insufficient to pay the entire
liquidation preference of the Series 2000-1 preferred stock and the Series B
preferred stock then holders of Series 2000-1 preferred stock shall receive a
pro-rata portion of the assets available for distribution in the same proportion
as liquidation preference of the Series 2000-1 preferred stock bears to the
aggregate liquidation preference of both series.
Each share of the Series 2000-1 preferred stock is convertible into a number of
shares of our common stock as determined at each Closing based on the following
conversion formula (i) $2.50 divided by (ii) the market closing price of the
Company's common stock one day prior to each Closing, plus $.125, at any time,
at the option of the holder, subject to a market closing price floor of $2.25
per share. For instance, if at a specific closing, the prior day's market
closing price of the Company's common stock is $2.25, each share of the Series
2000-1 preferred stock would convert into 1.05 shares of common stock based on
the following conversion formula: $2.50/($2.25 + $.125). Alternatively, if, at a
specific closing, the prior day's market closing price of the Company's common
stock is $2.75, each share of the Series 2000-1 preferred stock would convert
into 0.87 shares of common stock based on the following conversion formula:
$2.50/($2.75 + $.125). The number of shares are subject to adjustment for
fundamental corporate changes. The shares are not redeemable for the first three
years after the Final Closing. Thereafter, they are redeemable at $2.50 per
share upon 30 days notice during which period the shares may be convertible into
shares of common stock.
The holder of the Series 2000-1 preferred stock have no voting rights except as
otherwise provided by Delaware law or with respect to any matter which may
adversely effect the rights of holder Series 2000-1 preferred stock. We may not
issue any shares senior to the Series 2000-1 preferred stock. Dividends will be
payable when, as and if declared by our Board of Directors, No dividends will
accrue unless declared by our Board of Directors. The shares of Series 2000-1
preferred stock will be issued in sub-series. The only variation between the
different sub-series will be the conversion price, as determined by the closing
price at each Closing, as set forth above.
Public Warrants
The following description of the warrants is qualified by reference to the
warrant agreement, dated February 21, 1997, between IFS, American Stock Transfer
& Trust Company and Duke & Company, a prior underwriter.
Each warrant entitles the registered holder to purchase one and thirty three
hundredths (1.33) shares of common stock at a price of $6.25 per warrant (or
$4.71 per share).
The warrants are redeemable by IFS, with the prior consent of Duke, at a price
of $.10 per warrant, provided that the last sale price of the common stock, for
a period of 20 consecutive days trading of the common stock ending not more than
three days prior to the date of any redemption notice equals or exceeds at least
$8.80 per share, subject to adjustment. The warrants shall be exercisable until
the close of the business day preceding the date fixed for redemption. Any
notice of redemption will be mailed between thirty (30) days, and forty-five
(45) days prior to the redemption date. Since Duke is no longer in business, we
have taken the position that the consent of Duke is no longer required. The
warrants expire on February 20, 2002.
The exercise price of the warrants and the number of shares of common stock or
other securities and property issuable upon exercise of the warrants are subject
to adjustment in certain circumstances, including stock dividends on, or a stock
split, subdivision, combination or recapitalization of the common stock, and
will also be subject to adjustment upon the sale or issuance of common stock or
securities convertible into or exchangeable for common stock at less than $6.25
per 1.33 shares (or $4.71 per share), except in certain circumstances.
No fractional shares will be issued upon exercise of the warrants. However, if a
warrant holder exercises all warrants owned by him or her of record, we will pay
to that warrant holder, in lieu of the issuance of any fractional share which is
otherwise issuable, an amount in cash based on the market value of the common
stock on the last trading day prior to the exercise
Delaware Law and Certain Charter Provisions
We are subject to Section 203 of the Delaware General Corporation Law, which
prohibits a Delaware corporation from engaging in a wide range of specified
transactions with any interested stockholder.
<PAGE>
An interested stockholder is defined to include, among others, any person or
entity who in the previous three years obtained 15% or more of any class or
series of stock entitled to vote in the election of directors. These rules do
not apply if the transaction in which the stockholder became an interested
stockholder receives prior approval by the Board of Directors or the holders of
two-thirds of the outstanding shares of each class or series not owned by the
interested stockholder. Our Certificate of Incorporation and By-laws contain
certain additional provisions which may have the effect of delaying or
preventing a change in control of the Company.
Such provisions include blank check preferred stock (the terms of which may be
fixed by the Board of Directors without stockholder approval). Accordingly, our
Board of Directors is empowered, without stockholder approval, to issue
preferred stock, other than the preferred stock, with dividend, liquidation,
conversion, voting or other rights that could adversely affect the voting power
or other rights of the holders of the common stock. In the event of issuance,
the preferred stock could be used, under certain circumstances, as a method of
discouraging, delaying or preventing a change in control of the Company.
Transfer and Warrant Agent
The transfer agent of our common stock is American Stock Transfer & Trust
Company.
LEGAL MATTERS
Certain legal matters in connection with the securities offered will be passed
upon for the Company by Parker Duryee Rosoff & Haft, New York, New York 10017.
EXPERTS
Our consolidated financial statements, as of April 30, 2000, and for each of the
two years then ended have been incorporated by reference in this document in
reliance upon the report of Urbach Kahn & Werlin LLP, independent auditors,
incorporated by reference in this document, given on the authority of said firm
as experts in accounting and auditing.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the Company's estimates of the expenses to be
incurred by it in connection with the common stock being offered hereby:
--------------------------------------------------------------------------------
SEC Registration Fee $855.00
Printing expenses 3,500.00 **
Legal fees and expenses 7,000.00 **
Accounting fees and expenses 500.00 **
Miscellaneous expenses 500.00 **
------------
TOTAL $12,355.00
============
------------
** Estimated
Item 15. Indemnification of Directors and Officers.
Article NINTH of the Certificate of Incorporation of IFS International Holdings,
Inc. ("Registrant") provides that no director shall have any personal liability
to Registrant or its stockholders for monetary damages for breach of fiduciary
duty as a director, except with respect to (1) a breach of the director's duty
of loyalty to Registrant or its stockholders, (2) acts or omissions not in good
faith which involve intentional misconduct or a knowing violation of law, (3)
liability under Section 174 of the Delaware General Corporation Law or (4) a
transaction from which the director derived an improper personal benefit.
Article TENTH of the Certificate of Incorporation of Registrant provides that
Registrant shall indemnify, to the fullest extent permitted by Section 145 of
the Delaware General Corporation Law, as amended from time to time, any and all
persons whom it shall have power to indemnify under such section.
Item 16. Exhibits and Financial Statement Schedules.
See Exhibit Index
<PAGE>
Item 17. Undertakings.
The undersigned Company hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement 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.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, as amended (the "Securities Act"), each such
post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(4) That, for purposes of determining any liability under the
Securities Act, each filing of the Company's annual report pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, that is
incorporated by reference in the Registration Statement, shall be deemed to be a
new registration statement relating to the securities offered herein, and
theoffering of such securities at that time shall be deemed to be the initial
bonafide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act may
be permitted to directors, officers, and controlling persons of the Company
pursuant to Item 15 of Part II of the Registration Statement, or otherwise, the
Company has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the Company
of expenses incurred or paid by a director, officer or controlling person of the
Company 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 Company 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 Securities Act and will be governed by
the final adjudication of such issue.
<PAGE>
SIGNATURES
In accordance with 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 of filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, hereunto duly
authorized, in the City of Troy, State of New York, on November 24, 2000.
IFS INTERNATIONAL HOLDINGS, INC.
By: _/s/ David L. Hodge_______________
David L. Hodge
President and Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below
constitutes and appoints John P. Singleton and David L. Hodge, and each of them,
with full power to act without the other, his true and lawful attorney-in-fact
and agent, with full power of substitution and resubstitution for him and in his
name, place and stead, in any and all capacities to sign any and all amendments
(including post-effective amendments) to this Registration Statement, and to
file the same, with all exhibits thereto, and the 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 or 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 any of them, or their or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
In accordance with the requirements of the Securities Act of 1933, this
Registration Statement was signed by the following persons in the capacities and
on the dates stated.
<PAGE>
In accordance with the requirements of the Securities Act of 1933, this
Registration Statement was signed by the following persons in the capacities and
on the dates stated.
Signature Title Date
President and Chief
Executive Officer,
Director (Principal
/s/ David L. Hodge Executive Officer) November 24, 2000
---------------------
David L. Hodge
Chairman of the Board,
/s/ John P. Singleton Director November 24, 2000
---------------------
John P. Singleton
/s/ Carmen A. Pascuito Secretary November 24, 2000
---------------------
Carmen A. Pascuito
/s/ Simon J. Theobald Director November 24, 2000
---------------------
Simon J. Theobald
/s/ Frank A. Pascuito Director November 24, 2000
---------------------
Frank A. Pascuito
/s/ Per Olof Ezelius Director November 24, 2000
---------------------
Per Olof Ezelius
/s/ DuWayne J. Peterson Director November 24, 2000
---------------------
DuWayne J. Peterson
/s/ C. Rex Welton Director November 24, 2000
---------------------
C. Rex Welton
<PAGE>
EXHIBIT INDEX
Description of Exhibit
4.1 Certificate of Designation of the Series A Convertible preferred stock (2)
4.1b Certificate of Amendment of Certificate of Designation of the Series A
Convertible preferred stock (3)
4.3 Form of certificate evidencing Warrants (1)
4.4 Form of certificate evidencing shares of common stock (1)
4.5 Warrant Agreement between the Company and the Underwriter (2)
4.6 Form of Warrant Agreement between the Company and American Stock Transfer
and Trust Company, as Warrant agent (1)
4.7 Debenture Investment Agreement, dated July 6, 1989, between the Company and
New York State Science and Technology Foundation, and amendments thereto
(1)
4.8 Loan Agreement, dated January 11, 1989, between the Company and North
Greenbush Industrial Development Agency and amendments thereto (1)
4.9 Warrant Agreement, dated November 6, 1998, between the Company and MDB
Capital Group LLC. (4)
4.10 Investment Banking Agreement, dated November 6, 1998, between the Company
and MDB Capital Group LLC. (4)
4.11 Form of Convertible Promissory Note Agreements, dated July 6, 1999, between
the Company and Gilston Corporation, Ltd., Manchester Asset Management,
Ltd., Headwaters Capital, and Colbrooke Capital. (4)
4.12 Form of Warrant Agreements, dated July 6, 1999, between the Company and
Gilston Corporation, Ltd., Manchester Asset Management, Ltd., Headwaters
Capital, and Colbrooke Capital. (4)
4.13 Registration Rights Agreement, dated July 2, 1999, between the Company and
Gilston Corporation, Ltd., Manchester Asset Management, Ltd., and
Headwaters Capital. (4)
4.14 Note And Warrant Purchase Agreement, dated July 2, 1999, between the
Company and Gilston Corporation, Ltd., Manchester Asset Management, Ltd.,
and Headwaters Capital. (4)
4.15 Market Access Program Marketing Agreement, dated as of April 29, 1999,
between the Company and Continental Capital & Equity Corporation. (4)
4.16 Warrant to purchase common stock dated as of February, 2000 between IFS
International Holdings, Inc. and Commonwealth Associates, L.P. (5)
4.17 Warrant to purchase common stock dated as of February, 2000 between IFS
International Holdings, Inc. and Commonwealth Associates, L.P. (5)
4.18 Warrant to purchase common stock dated as of February, 2000 between IFS
International Holdings, Inc. and Commonwealth Associates, L.P. (5)
4.19 Securities Purchase Agreement dated March 23, 2000 between IFS
International Holdings, Inc. and the Shaar Fund. (5)
4.20 Warrant Agreement dated March 23, 2000 between IFS International Holdings,
Inc. and the Shaar Fund. (5)
4.21 Registration Rights Agreement dated March 23, 2000 between IFS
International Holdings, Inc. and the Shaar Fund. (5)
5.1 Opinion of Parker Duryee Rosoff & Haft A Professional Corporation
23.1 Consent of Urbach Kahn & Werlin LLP
23.2 Consent of Parker Duryee Rosoff & Haft (included in Exhibit 5.1)
1 Denotes document filed as an exhibit to the Company's Registration
Statement on Form SB-2 (File No. 333-11653) and incorporated herein by
reference.
2 Denotes document filed as an exhibit to the Company's Quarterly Report
on Form 10- QSB for the quarter ended January 31, 1997 and
incorporated herein by reference.
3 Denotes document filed as an exhibit to the Company's Proxy Statement,
dated February 1, 1999 and incorporated herein by reference.
4 Denotes documents filed as an exhibit to the Company's annual report
on Form 10-KSB, for the year ended April 30, 1999 and incorporated
herein by reference.
5 Denotes documents filed as an exhibit to the Company's annual report
on Form 10-KSB, for the year ended April 30, 2000 and incorporated
herein by reference.
<PAGE>
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IFS INTERNATIONAL HOLDINGS, INC.
1,510,097
Common Stock
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PROSPECTUS
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November 27, 2000
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You should rely only on the information contained in this prospectus. No dealer,
salesperson or other person is authorized to give information that is not
contained in this prospectus. This prospectus is not an offer to sell nor is it
seeking an offer to buy these securities in any jurisdiction where the offer or
sale is not permitted. The information contained in this prospectus is correct
only as of the date of this prospectus, regardless of the time of the delivery
of this prospectus or any sale of these securities.
