May 17, 2000
Mr. Mark Shuman
Securities and Exchange Commission
Washington D.C. 20549
Re: IFS International, Inc.
Amendment No. 2 to Registration Statement on Form S-3
File No. 333-88121
Filed on February 28, 2000
Re:IFS International Holdings, Inc. (formerly IFS International, Inc.)
Dear Mr. Shuman:
Per our conversation, the above registration statement has been amended
to reflect the terms of the MDB Capital and Continental Warrants. We have
already disclosed that (i) the MDB warrants were acquired in November 1998 and
therefore held for more than one year and (ii) that these warrants were issued
in conjunction with a separate advisory agreement.
We have also disclosed that MDB has made a claim against IFS for
failure to promptly register the shares and our defense to this claim. We have
also otherwise updated the information in the registration statement.
If you have any questions please contact the undersigned at your
earliest convenience.
Very truly yours,
Michael D. DiGiovanna
<PAGE>
February 22, 2000
Securities and Exchange Commission
Washington D.C. 20549
Re: IFS International, Inc.
Amendment No. 1 to Registration Statement on Form S-3
File No. 333-88121
Filed on January 13, 2000
Dear Sir/Madam:
Set forth below are our responses to your letter of January 27, 2000
with respect to the above. The numbers correspond to the numbered comments of
your letter.
1. The Company has marked this amendment to note the changes from the
prior filing.
2. The comment of your letter has become moot as the sale of the shares
subject to the exercise of this warrant is now included in the
registration statement.
We wish, however, to provide additional information concerning the
relationship of the Company to MDB. MDB Capital paid $30,000 in consideration of
the purchase of the warrants in November 1998. The right to purchase the
warrants was included in an investment banking agreement dated November 6, 1998
between MDB and the Company. This agreement required MDB to provide advisory
services to the Company with respect to acquisition and financial planning,
capital structure issues, and the continued refinement of a business plan.
Compensation for services involving financing and acquisitions through MDB were
subject to separate negotiations. MDB never acted as an underwriter or placement
agent or brought any other transaction to the Company.
If you need any additional information please do not hesitate to
contact the undersigned.
Very truly yours,
PARKER DURYEE ROSOFF & HAFT
By:________________________________
<PAGE>
As filed with the Securities and Exchange Commission on May 17, 2000
File No. 333-88121
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------
AMENDMENT 3
TO
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
--------------
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)
------------
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.
<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(1) Price(1) Registration Fee
Registered (2)
- ------------------------------ -------------------- ------------------- ------------------------ ------------------
common stock, par value
<S> <C> <C> <C> <C>
$.001 per share 1,583,716 $2.12 $3,357,478 $934.00
Total Registration Fee $934.00
============================== ==================== =================== ======================== ==================
</TABLE>
(1) 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 September
27, 1999.
(2) Paid at time of original filing, September 30, 1999.
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
1,583,716 SHARES
IFS INTERNATIONAL HOLDINGS, INC.
common stock
--------------
Stockholders of IFS International Holdings, Inc., named under the caption
"Selling Stockholders" may offer and sell up to 1,583,716 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 May 12, 2000 was $5.25.
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 May 17, 2000
<PAGE>
TABLE OF CONTENTS
Page
INTRODUCTION..................................................................2
RECENT DEVELOPMENTS...........................................................3
WHERE YOU CAN FIND MORE INFORMATION...........................................6
RISK FACTORS..................................................................7
FORWARD-LOOKING STATEMENTS....................................................11
USE OF PROCEEDS...............................................................12
SELLING STOCKHOLDERS..........................................................12
PLAN OF DISTRIBUTION..........................................................15
DESCRIPTION OF SECURITIES.....................................................17
LEGAL MATTERS.................................................................20
EXPERTS.......................................................................20
<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.
Our IFS subsidiary derives revenues principally from the licensing of its family
of software products.
Our IFS' subsidiary's family of software products, marketed under the name TPII,
serves as a UNIX-based manager for electronic funds transfer systems. An
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. TPII software products are compatible with a significant
portion of the industry standard computer platforms, are designed to operate
with computers utilizing the UNIX operating system, are written in C programming
language and incorporate Oracle relational database technology and object
oriented design concepts. TPII software is offered in separate modules which
perform different functions.
The TPII software products are typically installed at the financial
institution's main processing facility. TPII software products have been
primarily installed in electronic funds transfer systems of banks and other
financial institutions located in emerging countries and former Eastern Bloc
nations.
TPII software is also capable of managing electronic funds transfer 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. Our IFS subsidiary has developed software for Visa
International Service Association. Since the first calendar quarter of 1997, our
IFS subsidiary completed, on behalf of Visa, several pilot programs and
subsequently entered into several license and maintenance agreements for these
sites.
Our NCI subsidiary provides bank teller/platform and networking solutions to
large financial institutions and major suppliers of branch automation equipment.
NCI is currently developing a new product line, NCI Business Centre a. NCI
Business Centre a will be a server-centric and enterprise-wide retail banking
solution which will automate delivery channels, such as teller, platform,
internet banking, call center and kiosks. NCI Business Centre a will use Windows
NT, browsers and TCP/IP protocol technologies for delivery of functionality over
Intranet and Internet networks. NCI is headquartered in Charlotte, North
Carolina and has overseas subsidiaries and branch offices marketing its products
and services internationally.
We provide our customers with maintenance services for its software products for
a separate fee. The Company also offers other support services, such as
additional training of customer personnel, project management and consulting,
for additional consideration.
We were incorporated in Delaware in September 1986 under the name Wellsway
Ventures, Inc. ("WWV"). WWV 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.
RECENT DEVELOPMENTS
We have extended our current market access program marketing agreement with
Continental Capital and Equity Corporation for one more year. We have issued an
option to purchase 200,000 shares of our common stock in 50,000 share blocks at
the following per share prices; $8.50, $10.00, $12.50, and $15.00. We have also
agreed to issue Continental Capital an option on the one year anniversary date
of the execution of the contract to purchase 200,000 shares in 50,000 share
blocks. The exercise prices are as follows; 125% over the closing bid on the one
year anniversary date of the execution of the contract, 150% over the closing
bid on the one year anniversary date of the execution of the contract, 175% over
the closing bid on the one year anniversary date of the execution of the
contract, and 200% over the closing bid on the one year anniversary date of the
execution of the contract.
MDB Capital has claimed that it has been damaged by our failure to timely file a
registration statement covering the shares underlying their warrant to purchase
200,000 of our common shares. They have claimed damages in the amount of
$2,200,000 based on the highest price of our common stock subsequent to the time
MDB believes a registration statement would have been effective. We believe that
the registration statement has been delayed because of legal issues relative to
MDB. In addition, we may assert claims against MDB for their failure to perform
under the advisory agreement entered into contemporaneously and as partial
consideration for the warrant issued.
We have also received a claim on behalf of purchasers which acquired their
shares in a private placement in July 1999. The claim alleged these persons are
entitled to liquidated damages in the amount of $175,000 because of alleged
delays in completing registration of their securities. We believe the claim is
without merit as the delay in registering the underlying common shares was
caused by unresolved questions concerning these securityholders and their
inability to timely provide accurate information to us in connection with the
registration statement.
We have entered into an agreement with a corporation controlled by Mr. Frank
Pascuito. This corporation will receive a non-exclusive license from us to
utilize our technology in connection with the operation of a regional internet
processing center for financial institutions. The agreement provides for the
issuance to us of 30% of the stock of this corporation upon the initial
capitalization of the entity. We have permitted this entity to utilize our
premises and will and have advanced amounts to this entity. The entity is
required to repay us from operations for these advances and for the use of our
premises. Mr. Pascuito has agreed to terminate his employment agreement with us.
We have entered into this transaction because we have determined that this
business is not one we desire to enter into at this time and, even if we did, we
do not have the required funds to commence operations.
We have entered into an agreement with the Shaar Fund. Pursuant to this
agreement, the Shaar Fund purchased 200,000 shares of our newly created Series B
Preferred Stock, and warrants to purchase 200,000 shares of our common stock at
an exercise price of $5.44 per share. We received gross proceeds of $2,000,000
in connection with this purchase. The preferred stock is convertible into shares
of our common stock at the greater of $5.44 or 90% of market through March 23,
2000 and 82% of market thereafter. The Preferred Stock is automatically
converted into shares of common stock on March 24, 2003. The purchase agreement
with the Shaar Fund requires us to offer a right of first refusal for shares
issued at prices below market price. We are also obligated to register the
shares issuable upon conversion of the preferred stock and the shares issuable
upon the exercise of the warrants.
On January 31, 2000 and March 9, 2000, second and third amendments respectively
were made to the employment agreements for David Hodge and Simon Theobald. The
second amendment provides for compensation to the executive, irrespective of
whether or not the executives employment is terminated, if there is a (i) change
of control; or (ii) transfer or sale of all or substantially all of the assets
of IFS, or (iii) transfer or sale of beneficial ownership of more than fifty
percent (50%) or more of the total combined voting power of our then outstanding
voting securities. We shall pay to Mr. Hodge an amount equal to 3% of the first
$10,000,000 in value received (including cash, securities, debt or any other
form of property) in connection with such change of control, or transfer or
sale, 6% of the next $10,000,000 in value received in connection with such
change of control, transfer or sale and 7% of any value received in excess of
$20,000,000. We shall pay to Mr. Theobald an amount equal to 2% of the first
$10,000,000 in value received (including cash, securities, debt or any other
from of property) in connection with such change of control, or transfer or
sale, 4% of the next $10,000,000 in value received in connection with such
change of control, transfer or sale and 6% of any value received in excess of
$20,000,000. The third amendment to each agreement compensates the executives in
the form of stock appreciation rights. We shall grant to Mr. Hodge and Mr.
Theobald, stock appreciation rights based on 100,000 and 50,000 shares of our
common stock, respectively, in the year 2000 and on each anniversary date of the
execution of the amendment.
On January 31, 2000 and March 9, 2000, first and second amendments respectively
were made to the agreement for services for John Singleton. The first amendment
to the agreement for services addresses compensation to the executive on a
percentage basis upon the sale or change of control of IFS. We shall pay to Mr.
Singleton an amount equal to 2% of the first $10,000,000 in value received
(including cash, securities, debt or any other form of property) in connection
with such change of control, or transfer or sale, 4% of the next $10,000,000 in
value received in connection with such change of control, transfer or sale and
6% of any value received in excess of $20,000,000. The second amendment to the
agreement for services compensates the executive in the form of stock
appreciation rights. We shall grant to Mr. Singleton, stock appreciation rights
based on 50,000 shares of our common stock in the year 2000 and on each
anniversary date of the execution of the amendment.
On January 25, 2000 we entered into an advisory agreement with Commonwealth
Associates, L.P. The agreement calls for Commonwealth Associates, L.P. to
perform certain strategic advisory services related to corporate finance and
other financial service matters. The term of the agreement is for four months
commencing on January 25, 2000 renewable at the mutual discretion of us and
Commonwealth Associates, L.P. Commonwealth Associates, L.P. received $10,000 as
an advance against expenses and will receive a monthly retainer. There are
provisions in the advisory agreement in which Commonwealth Associates, L.P. will
receive additional compensation in the event of any financing obtained by us
through Commonwealth. Commonwealth Associates, L.P. also received warrants to
purchase 850,000 shares of our common stock.
On December 6th 1999, we entered into a Stock Purchase Agreement to acquire all
of the outstanding shares of Global Insight Group LTD and its three operating
subsidiaries. The consideration is payable entirely in shares of the Company's
common stock. We only issued three shares at closing but are obligated to issue
additional shares based on future financial performance of the acquired company.
There are two components to this additional consideration. Initially, the
sellers will receive shares of our common stock having a market value equal to
four times net earnings of the acquired company as set forth in the agreement.
In addition, for each of the years 2000 through 2002 the sellers will receive
shares of our common stock having a market value equal to fifty (50%) of the
earnings for each year or (thirty (30%) percent if the seller receives stock
having a value of $1,200,000).
Our board of directors recently authorized the payment of bonuses to certain of
its officers and directors if we successfully complete a financing. Pursuant to
this authorization we would pay a total of 8% of the gross proceeds for a
financing up to $10,000,000, 15.5% for a financing between $10,000,001 and
$20,000,000 and 21% for financing above $20,000,000. Mr. David Hodge, Mr. Simon
Theobald and Mr. John Singleton, IFS International Holdings CEO, IFS
International CEO and the chairman of the board would receive the following
percentages, respectively; a) of the 8%, 3%, 2% and 2%; b) of the 15.5%, 6%, 4%
and 4%; and c) of the 21%, 7%, 6% and 6%.
In October, 1999 we issued 1,051,716 shares of our common stock to Per Olof
Ezelius, one of our directors and president of our NCI subsidiary. The shares
were issued as additional contingent consideration pursuant to the terms of the
plan and merger agreement dated January 30, 1998. Mr. Ezelius may receive
additional contingent shares in future years based on the financial performance
of NCI through fiscal year 2001 pursuant to the plan and merger agreement.
<PAGE>
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, the 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."
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:
<PAGE>
Annual Report on Form 10-KSB for fiscal year 1999 and
Amendment thereto on Form 10-KSB/A dated February 25, 2000.
Quarterly Report on Form 10-QSB for quarter ended July 31, 1999.
Quarterly Report on Form 10-QSB for quarter ended October 31, 1999.
Quarterly Report on Form 10-QSB for quarter ended January 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
<PAGE>
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.
We incurred a net loss of $703,907 and had a net income of $270,688 for our
fiscal year ended April 30, 1999 and our nine months ended January 31, 2000,
respectively. As of January 31, 2000, we had an accumulated deficit of
$4,312,995. 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 73% and 85% of total revenues for the nine month
periods ended January 31, 1999 and 2000, respectively, 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 services in foreign
markets.
We are dependent on the electronic funds transfer and the bank automation
markets.
Our IFS subsidiary derives its revenues from sales for the electronic funds
market. Therefore, we are susceptible to adverse events in that market. For
example, a decrease in the number of electronic funds transfer transactions by
the general public or in spending by financial institutions for software for
electronic funds transfer and bank automation and related services could result
in a smaller overall market for electronic funds transfer software. These
factors, as well as others negatively affecting the electronic funds transfer
market, could have a material adverse effect on our financial condition and
results of operations.
<PAGE>
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 shareholder's percentage interest may be
reduced as a result of the conversion of our outstanding convertible notes and
series B preferred stock.
We have convertible notes outstanding with a principal amount of $1,075,000 and
have recently issued 200,000 shares of convertible preferred stock. The
conversion of the notes and 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. The preferred shares may be converted into shares of common stock at
the lower of $5.44 per share or 90% of market value (82% after March 23, 2001).
Because the number of shares issued under the note and the preferred stock is
dependent upon our market price, the lower the market price, the greater the
number of shares may be issued. The conversion of a significant number of
convertible notes or 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 number of our shares of common stock issuable upon conversion
at market prices of $5.31 on May 12, 2000 in separate tables for each of the
notes and preferred stock and at lower market prices, assuming in each case, all
of the securities are exercised:
<PAGE>
Number of Shares issuable
Market Price upon conversion of notes
$5.31 (current) 358,333 *
$3.98 (25% decline) 358,333 *
$1.33 (75% decline) 899,770
* Calculation based on a minimum of $3.00 per share.
Number of Shares Number of Shares
issuable Upon issuable Upon
conversion of preferred conversion of preferred
Market Price stock through 3/23/2001 stock after 3/23/2001
$ 5.31 (current) 418,498 459,327
$ 3.98 (25% decline) 557,997 612,436
$ 1.33 (75% decline) 1,673,990 1,837,307
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 6,711,623 shares of common stock,
including debentures and other rights to acquire shares of our 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 factors. IFS issued the convertible promissory notes in the amount of
$1,075,000 which are convertible into 358,333 shares of common stock, subject to
adjustment based on current market prices. We also issued preferred stock with a
stated value of $2,000,000 which is convertible into 418,498 shares of our
common stock, subject to adjustment based on current market prices. In addition,
we may be obligated to issue a substantial number of shares based on the
financial performance of NCI through fiscal year 2001 and Global Insight Group
through fiscal year 2002 as shares pursuant to existing merger agreements. The
issuance of all these shares could have an adverse impact upon the market price
of our common stock.
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. In addition, many of the larger financial institutions have developed their
own systems internally. However, we believe our current products will continue
to be competitive based on cost and technology. TPII software products face
strong competition from proprietary (legacy) and UNIX-based software. In the
smart card market, other financial institutions and companies including certain
institutions and companies which have greater resources than us, have developed
and are developing their own smart card technology. 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 its success in enhancing the performance
of its current TPII software products, such as the ability for TPII to handle
higher volumes of card transactions and the adaptation of its software products
to smart card technology, and developing new software products that address the
increasingly complex needs of customers.
<PAGE>
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.
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. 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 a by a significant number of new
customers.
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
Of the shares offered hereby by the selling stockholder, 1,083,716 shares are
presently issued and outstanding and the balance, or 500,000 shares, may be
issued pursuant to outstanding warrants.
One of the selling stockholders, Per Olof Ezelius, has acquired his 1,051,716
shares pursuant to a Plan and Merger Agreement entered into in January, 1998.
Mr. Ezelius was the principal shareholder of Network Controls Holdings Inc.
which owned all the shares of Networks Controls Inc. a subsidiary of Holdings.
The Company merged with Holdings in January 1998. Pursuant to the terms of the
merger, Mr. Ezelius is to receive additional consideration if the pre-tax income
of Network Controls exceeds specified levels in each of fiscal years 1999, 2000,
and 2001 and if cumulative pre-tax income is equal or greater than a specified
amount. The contingent consideration is payable in shares of our common stock at
the greater of market value or $4.00. Mr. Ezelius received 1,051,716 shares as
contingent consideration in 1999. All shares of Mr. Per Olof Ezelius offered
were issued for performance of this subsidiary in fiscal 1999. Mr. Ezelius is
one of our directors and also the president and chief executive officer of NCI,
a subsidiary of IFS.
Pollet Law acquired 32,000 shares of our common stock offered as payment for
professional services rendered.
The shares offered by MDB Capital LLC ("MDB") are subject to warrants to
purchase 300,000 shares sold to MDB in November, 1998 for $30,000. The right to
purchase the Warrants was included in an Investment Banking Agreement dated
November 6, 1998 between us and MDB. The Agreement required MDB, a
broker-dealer, to provide a wide array of advisory services including
acquisition, financing and strategic planning. Separate fees were to be
negotiated to MDB in the event it completed a financing or obtained an
acquisition. No financing or other transaction was completed by MDB for us. The
warrants issued to MDB are exercisable through November 5, 2003 at a fixed
exercise price of $2.50 per share. The exercise price may be subject to
adjustment in certain circumstances if our stock is split, or we reorganize,
merge or {if we issue shares at a price below the exercise price of these
warrants}. Continental Capital and Equity Corporation has acquired 200,000
warrants pursuant to an agreement as partial consideration for investment
relations services (see exhibit 4.15). Continental Capital is in the business of
providing investment relations services and financial public relations. They
also assist companies in composing and issuing press releases. The warrants are
issued pursuant to an exemption from Section 4(2) of the act. The shares subject
to these warrants are included in this registration statement. The warrants
issued to Continental are exercisable over a one year period beginning on the
effective date of this registration statement at various exercise prices as
follows; $3.50 per share for 35,000 shares, $4.50 for 45,000 shares, $5.50 for
55,000 shares and $6.50 for 65,000 shares.
In a renewal agreement with Continental Capital, we have issued an option to
purchase an additional 200,000 shares at the following exercise prices; $8.50
per share for 50,000 shares, $10.00 per share for 50,000 shares, $12.50 per
share for 50,000 shares and $15.00 per share for 50,000 shares. We have also
agreed to issue an option to purchase 200,000 shares of our common stock on May
3, 2001, the one year anniversary date of the execution of the agreement. That
lot of 200,000 shares will be exercisable at the following exercise prices; 125%
over closing bid on the one year anniversary date for 50,000 shares, 150% over
closing bid on the one year anniversary date for 50,000 shares, 175% over
closing bid on the one year anniversary date for 50,000 shares, and 200% over
closing bid on the one year anniversary date for 50,000 shares, 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 Percent of
Stockholder or Group Beneficially Shares Shares Beneficially Shares
Owned Outstanding Offered Owned Outstanding
- ---------------------------------------------- -------------- --------------- ------------- -------------- --------------
<S> <C> <C> <C> <C>
Pollet Law 32,000 1% 32,000 None -0-
Continental Capital & Equity Corporation 400,000 9% 200,000 None 200,000
MDB Captial 300,000 7% 300,000 None -0-
Per Olof Ezelius 1,084,241 21% 1,051,716 32,525 1%
</TABLE>
The above assumes all of the shares being offered will be sold. Because the
selling stockholders may sell all, some or none of the shares that it holds, the
actual number of shares that will be sold by the selling stockholders upon or
prior to termination of this offering may vary. The selling stockholders may
have sold, transferred or otherwise disposed of all or a portion of their shares
since the date on which they provided the information regarding their common
stock in transactions exempt from the registration requirements of the
Securities Act. Additional information concerning the selling stockholders may
be set forth from time to time in prospectus supplements to this prospectus.
The above does not include 10,478 shares of common stock which are not
exercisable within 60 days of the date of this registration statement. Mr.
Ezelius may receive additional contingent shares in future years based on the
financial performance of NCI through fiscal year 2001 pursuant to the plan and
merger agreement.
<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.
<PAGE>
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. 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 4,039,985 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, 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. All outstanding
shares of the preferred stock automatically converted to common stock on April
1, 1999. 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.
The Company has recently authorized and issued 200,000 shares of its newly
created Series B Preferred Stock having the terms set forth below;
o Liquidation Preferences. Upon liquidation the Series B 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 stock certain changes relating
to us may be deemed to be a liquidation for the purposes of Series B
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 Dividend. 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
unit market value in lieu of a cash.
o Conversion. Each share of Series B Stock is convertible at the lower
of 90% of current market price (82% after March 23, 2001) or $5.44 per
shares. 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 stock at $6.00 per share until December 24, 2000
and thereafter at $6.25 per share plus accrued dividend.
o Voting rights. The holder of the Series B 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 stock.
o Additional Rights. We may not issue any shares junior the Series B
stock.
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, copy of this
agreement is filed as an exhibit to this registration statement of which this
prospectus is a part.
Each warrant originally entitled the registered holder to purchase one
(1.0) share of preferred stock at a price of $6.25, subject to adjustment as set
forth below, for a period of three years ending on February 20, 2002. As a
result of provisions in the warrant agreement, each warrant now 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 $8.00 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 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.
The warrants do not confer upon the holder any voting or any other
rights of a stockholder of IFS.
Warrants may be exercised upon surrender of the warrant certificate
evidencing those warrants on or prior to the expiration date (or earlier
redemption date) of the warrants at the offices of the transfer agent with the
form of "Election to Purchase" on the reverse side of the warrant certificate
completed and executed as indicated, accompanied by payment of the full exercise
price (by certified check payable to the order of the transfer agent) for the
number of warrants being exercised.
No warrant will be exercisable or redeemable unless a the time of
exercise the prospectus covering the shares of common stock issuable upon
exercise of the warrant is current and the issuance of shares has been
registered or qualified or is deemed to be exempt from registration or
qualification under the securities laws of the state of residence of the holder
of the warrant. We have undertaken to use its best efforts to maintain a current
prospectus relating to the issuance of shares of common stock upon the exercise
of the warrants until the expiration of the warrants, subject to the terms of
the warrant agreement. While it is our intention to maintain a current
prospectus, there is no assurance that it will be able to do so. See "Risk
Factors" - Need for Current Prospectus; Non-Registration in Certain
Jurisdictions of Shares Underlying IPO Warrants".
We had agreed, in connection with the exercise of the warrants pursuant
to solicitation by Duke, to pay to Duke a fee of five (5%) percent of the
exercise price for each warrant exercised in certain circumstances. Since Duke
is no longer conducting business, we do not believe this provision is
enforceable.
No fractional shares will be issued upon exercise of the warrants.
However, if a warrantholder exercises all warrants then owned of record by him
or her, we will pay to that warrantholder, 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
date.
<PAGE>
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. 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, 1999, 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 PC, 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 $934.00*
Printing expenses 3,500.00 **
Legal fees and expenses 5,000.00 **
Accounting fees and expenses 1,000.00 **
Miscellaneous expenses 500.00 **
------------------
TOTAL $10,934.00
==================
- ------------
* Paid at time of original filing, September 30, 1999.
** 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 the
offering of such securities at that time shall be deemed to be the initial bona
fide 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 May 17, 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 Frank A. Pascuito 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>
Signature Title Date
/s/ David L. Hodge President and Chief Executive Officer,
- -------------------- Director (Principal Executive Officer) May 17, 2000
David L. Hodge
/s/ John P. Singleton Chairman of the Board, Director May 17, 2000
- ---------------------
John P. Singleton
/s/ Frank A. Pascuito Director May 17, 2000
- ---------------------
Frank A Pascuito
/s/ Simon J. Theobald Director May 17, 2000
- ---------------------
Simon J. Theobald
/s/ Carmen A. Pascuito CFO, Secretary and Controller May 17, 2000
- ----------------------
Carmen A. Pascuito
Per Olof Ezelius Director May 17, 2000
- ----------------------
Per Olof Ezelius
/s/ C. Rex Welton Director May 17, 2000
- ----------------------
C. Rex Welton
/s/ DuWayne J. Peterson Director May 17, 2000
- -----------------------
DuWayne J. Peterson
<PAGE>
EXHIBIT INDEX
Exhibit No. Description of Exhibit
3.1 Certificate of Incorporation and amendments thereto of the Company (1)
(8)
3.2 By-laws, as amended, of the Company (1)
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 (5)
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. (7)
4.10 Investment Banking Agreement, dated November 6, 1998, between the
Company and MDB Capital Group LLC. (7)
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. (7)
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. (7)
4.13 Registration Rights Agreement, dated July 2, 1999, between the Company
and Gilston Corporation, Ltd., Manchester Asset Management, Ltd., and
Headwaters Capital. (7)
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. (7)
4.15 Market Access Program Marketing Agreement, dated as of April 29, 1999,
between the Company and Continental Capital & Equity Corporation. (7)
5.1 Opinion of Parker Duryee Rosoff & Haft A Professional Corporation (9)
10.1 * 1998 Stock Plan (5)
10.2 * 1996 Stock Option Plan (1)
10.3 * 1988 Stock Option Plan (1)
10.4 Lease Agreement, dated October 1, 1986 between the Company and
Rensselaer Polytechnic Institute and amendments thereto (the "Lease
Agreement") (1)
10.5 Addendum A to the Lease Agreement, dated January 7, 1997. (1)
10.6 Digital Prime Contracting Agreement, dated June 6, 1994, between the
Company and Digital Equipment International BV (1)
10.7 Software Development and License Agreement, dated July 8, 1996,
between the Company and Visa International Service Association (1)
10.8 * Employment Agreement, dated as of May 12, 1998 between the Company
and David L. Hodge. (6)
10.8b* Amendment to Employment Agreement, dated as of January 22, 1999
between the Company and David L. Hodge. (7)
10.9 * Employment Agreement, dated as of May 12, 1998, between the Company
and Frank A. Pascuito. (6)
10.9b* Amendment to Employment Agreement, dated as of January 22, 1999,
between the Company and Frank A. Pascuito. (7)
10.10* Employment Agreement, dated as of May 12, 1998, between the Company
and Simon J. Theobald. (2)
10.10b* Amendment to Employment Agreement, dated as of January 22, 1999,
between the Company and Simon J. Theobald. (7)
10.11*Extension Agreement, dated as of May 12, 1998 between the Company
and Per Olof Ezelius. (6)
10.12Purchase and Sale Agreement, dated as of December 17, 1996, between
the Company and Trustco Bank, National Association. (1)
10.13Form of Consulting and Investment Banking Agreement between the
Company and the Underwriter. (1)
10.14Promissory Note, dated March 14, 1997, between the Company and Key
Bank of New York. (3)
10.15*Consulting agreement, dated April 9, 1997, between the Company and
Jerald Tishkoff. (6)
10.16Plan and Merger Agreement, dated as of January 30, 1998, between the
Company and NCI Holdings, Inc. (4)
10.17Amended and Restated Note, dated as of April 15, 1999, between the
Company and Hudson River Bank and Trust Company. (7)
10.18Amended and Restated Note, dated as of April 15, 1999, between the
Company and Hudson River Bank and Trust Company. (7)
10.19Note And Mortgage Consolidation, Modification, Spreader, Extension
And Security Agreement, dated as of April 15, 1999, between the
Company, the Town of North Greenbush Industrial Development Agency and
New York Business Development Corporation. (7)
10.20Note And Mortgage Consolidation, Modification, Spreader, Extension
And Security Agreement, dated as of April 15, 1999, between the
Company, the Town of North Greenbush Industrial Development Agency and
New York Business Development Corporation. (7)
10.21Mortgage And Security Agreement, dated as of April 15, 1999, between
the Company, the Town of North Greenbush Industrial Development Agency
and New York Business Development Corporation. (7)
10.22Mortgage Note, dated as of April 15, 1999, between the Company and
New York Business Development Corporation. (7)
10.23Amended And Restated Mortgage Note, dated as of April 15, 1999,
between the Company New York Business Development Corporation. (7)
10.24General Security Agreement, dated as of April 15, 1999, between the
Company and Hudson River Bank and Trust Company. (7)
21.1 Subsidiaries of the Company (1)
23.1 Consent of Urbach Kahn & Werlin P.C.
23.2 Consent of Parker Duryee Rosoff & Haft (included in Exhibit 5.1) (9)
* Management contract or compensatory plan or arrangement.
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 Current Report,
dated March 14, 1997 and incorporated herein by reference.
4 Denotes document filed as an exhibit to the Company's Current Report,
dated January 30, 1998 and incorporated herein by reference.
5 Denotes document filed as an exhibit to the Company's Proxy Statement,
dated February 1, 1999 and incorporated herein by reference.
6 Denotes document filed as an exhibit to the Company's Annual Report,
dated April 30, 1998 and incorporated herein by reference.
7 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.
8 Denotes document filed as an exhibit to the Company's Proxy Statement,
dated October 28, 1999 and incorporated herein by reference.
9 Denotes document filed as an exhibit to the Company's Amendment 1 to
Form S-3 dated January 13, 2000 and incorporated herein by reference.
<PAGE>
- --------------------------------------------------------------------------------
IFS INTERNATIONAL HOLDINGS, INC.
1,583,716 Shares
common stock
-------------
PROSPECTUS
-------------
May 17, 2000
- --------------------------------------------------------------------------------
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.
EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We hereby consent to the incorporation by reference in the registration
statement of IFS International Holdings, Inc. on Form S-3 (File No. 333-88121)
of our report dated July 2, 1999, except for Note 7, as to which the date was
August 11, 1999, on our audits of the consolidated financial statements of IFS
International Holdings, Inc. (formerly IFS International, Inc.) and subsidiaries
as of April 30, 1999, and for the years ended April 30, 1999 and 1998, which
report is included in the Annual Report on Form 10-KSB.
URBACH KAHN & WERLIN PC
Albany, New York
May 12, 2000
