<PAGE>
As Filed with the Securities and Exchange Commission on December 9, 1997
Registration No. 333-31581
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________________________
AMENDMENT NO. 1
TO
FORM S-2 REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
___________________________
COUNTRY WIDE TRANSPORT SERVICES, INC.
(Exact name of Registrant as Specified in its Charter)
DELAWARE 95-4105996
(State or Other Jurisdiction) (I.R.S. Employer
of Incorporation or Organization) Identification No.)
119 Despatch Drive
East Rochester, New York 14445
(716) 381-5470
(Address, Including Zip Code, and Telephone Number, Including Area Code, of
Registrant's Principal Executive Office)
Timothy Lepper, President
Country Wide Transport Services, Inc.
119 Despatch Drive
East Rochester, NY 14445
(716) 381-5470
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code,
of Agent for Service)
Copies of all communications to:
Richard H. Holtzberg, Esquire
Holtzberg & Conway
349 W. Commercial St., Suite 3000
East Rochester, New York 14445
Approximate date of commencement of proposed sale to the public:
As soon as practicable after this Registration Statement becomes effective.
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, check the following box. /X/
If the registrant elects to deliver its latest annual report to security
holders, or a complete and legible facsimile thereof, pursuant to Item
11(a)(1) of this Form, check the following box. / /
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>
<CAPTION>
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
Title of Shares to be Amount to be Proposed Maximum Proposed Maximum Amount of
Registered Registered Offering Price Per Aggregate Offering Price Registration Fee
Share
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value
$0.10 3,288,000 $ 1.32 (1) $ 4,340,160 (1) $1,316
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for purposes of calculating the registration fee in
accordance with Rule 457 of the Securities Act of 1933. Specifically, the
registration fee is calculated based on the average of the reported bid and
asked prices of the securities as of July 15, 1997.
<PAGE>
3,288,000 SHARES
COMMON STOCK
COUNTRY WIDE TRANSPORT SERVICES, INC.
The shares of Common Stock, par value $0.10 per share (the "Common
Stock"), of Country Wide Transport Services, Inc. (the "Company") offered by
this Prospectus (the "Shares") are offered for sale by holders of the
Company's Common Stock (the "Selling Shareholders"). See "Selling
Shareholders." The Company has agreed to pay all of the expenses of this
offering but will not receive any of the proceeds from the sale of the
Selling Shareholders Shares being offered hereby.
A COPY OF THE COMPANY'S LATEST FORM 10-K REPORT AND ITS QUARTERLY REPORT
ON FORM 10-Q FOR THE THREE MONTH PERIOD ENDED SEPTEMBER 30, 1997 FILED WITH
THE SECURITIES AND EXCHANGE COMMISSION ARE REQUIRED TO BE DELIVERED WITH THIS
PROSPECTUS.
All brokerage commissions and other similar expenses incurred by the
Selling Shareholders will be borne by them. The aggregate proceeds to the
Selling Shareholders from the sale of the Shares will be the purchase price
of the Shares sold, less the aggregate agents' commissions and underwriters'
discounts, if any, and other expenses of issuance and distribution not borne
by the Company. See "Use of Proceeds" and "Plan of Distribution."
The Common Stock is quoted on the National Association of Securities
Dealers OTC Bulletin Board under the symbol "CWTV." The closing bid and
asked prices per share reported on the OTC Bulletin Board on December 5, 1997
were $.875 and $1.00 respectively.
The Selling Shareholders and any broker-dealers, agents or underwriters
that participate with the Selling Shareholders in the distribution of the
Shares, may be deemed "Underwriters," as that term is defined in the
Securities Act of 1993, as amended (the "Securities Act"), and any
commissions received by them and any profit on the resale of the Shares
purchased by them may be deemed underwriting commissions or discounts under
the Securities Act. The Shares to be offered by the Selling Shareholders may
be offered in one or more transactions in the over-the-counter market or in
negotiated transactions or a combination of such methods of sale, at market
prices prevailing at the time of sale, at prices related to those prevailing
market prices, or at negotiated prices. The Shares to be offered by the
Selling Shareholders may be sold either (a) to a broker or dealer as
principal for resale by such broker or dealer for its account pursuant to
this Prospectus (for example, in transactions with a "market maker") or (b)
in brokerage transactions, including transactions in which the broker
solicits purchasers.
-------------------------
No dealer, salesman or other person is authorized to give any information
or to make any representations other than those contained or incorporated by
reference in this Prospectus and, if given or made, such information or
representation must not be relied upon as having been authorized by the
Company or the Selling Shareholders, or any underwriter, dealer or agent.
This Prospectus and any supplement thereto shall not constitute an offer to
sell, or the solicitation of an offer to buy, any of the Shares offered
hereby in any jurisdiction where, or to any person to whom, it is unlawful to
make such offer or solicitation. Neither the delivery of this Prospectus nor
any sale made hereunder shall, under any circumstances, create an implication
that there has been no change in the affairs of the Company since the date
hereof or thereof, or that the information contained herein is correct as of
any time subsequent to the date hereof.
-------------------------
THE SECURITIES OFFERED HEREBY HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
-------------------------
The date of this Prospectus is December , 1997
1
<PAGE>
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by the more detailed
information and the consolidated financial statements, including notes
thereto (the "Consolidated Financial Statements"), which are incorporated by
reference into this Prospectus. Unless otherwise indicated, all share, per
share, and financial information set forth herein reflects the one-for-five
reverse stock split effective May 15, 1997. Investors should carefully
consider the information set forth under the heading "Risk Factors." As used
herein, the "Company" means Country Wide Transport Services, Inc. and its
subsidiaries, except where the context indicates otherwise, and a "fiscal
year" means the twelve month period ending on June 30th of the specified year.
THE COMPANY
Country Wide Transport Services, Inc. ("Country Wide" or "Company") with
its principal executive offices at 119 Despatch Drive, East Rochester, NY
14445, telephone number (716) 381-5470.
THE OFFERING
<TABLE>
<CAPTION>
<S> <C>
Common Stock Offered by the Selling Shareholders............. 3,288,000 shares
Common Stock to be Outstanding after the Offering............ 4,248,117 shares (1)
Use of Proceeds.............................................. No proceeds to the Company
OTC Bulletin Board Market Symbol............................. CWTV
</TABLE>
(1) Does not include 850,000 shares issuable to Company officers at $0.15 per
share under outstanding options which expire on May 1, 2002.
2
<PAGE>
RISK FACTORS
THE SHARES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK, INCLUDING THE
RISKS DESCRIBED BELOW. PROSPECTIVE INVESTORS SHOULD CAREFULLY CONSIDER THE
SPECIFIC FACTORS SET FORTH BELOW, AS WELL AS THE OTHER INFORMATION CONTAINED
IN OR INCORPORATED BY REFERENCE INTO THIS PROSPECTUS, BEFORE DECIDING
WHETHER TO INVEST IN THE SHARES OFFERED HEREBY.
THIS PROSPECTUS AND THE DOCUMENTS INCORPORATED HEREIN BY REFERENCE
CONTAIN CERTAIN "FORWARD-LOOKING STATEMENTS" WITHIN THE MEANING OF SECTION
27A OF THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), WHICH
REPRESENT THE COMPANY'S EXPECTATIONS OR BELIEFS, INCLUDING, BUT NOT LIMITED
TO, STATEMENTS CONCERNING INDUSTRY PERFORMANCE, THE COMPANY'S OPERATIONS,
PERFORMANCE, FINANCIAL CONDITION, GROWTH AND ACQUISITION STRATEGIES, MARGINS
AND GROWTH IN SALES OF THE COMPANY'S PRODUCTS. FOR THIS PURPOSE, ANY
STATEMENTS CONTAINED IN THIS PROSPECTUS THAT ARE NOT STATEMENTS OF HISTORICAL
FACT MAY BE DEEMED TO BE FORWARD-LOOKING STATEMENTS. WITHOUT LIMITING THE
GENERALITY OF THE FOREGOING, WORDS SUCH AS "MAY," "WILL," "EXPECT,"
"BELIEVE," "ANTICIPATE," "INTEND," "COULD," "ESTIMATE" OR "CONTINUE" OR THE
NEGATIVE OR OTHER VARIATIONS THEREOF OR COMPARABLE TERMINOLOGY ARE INTENDED
TO IDENTIFY FORWARD-LOOKING STATEMENTS. THESE STATEMENTS BY THEIR NATURE
INVOLVE SUBSTANTIAL RISKS AND UNCERTAINTIES, CERTAIN OF WHICH ARE BEYOND THE
COMPANY'S CONTROL, AND ACTUAL RESULTS MAY DIFFER MATERIALLY DEPENDING ON A
VARIETY OF IMPORTANT FACTORS, INCLUDING THOSE DESCRIBED BELOW UNDER THIS
"RISK FACTORS" SECTION AND ELSEWHERE IN THIS PROSPECTUS AND THE DOCUMENTS
INCORPORATED HEREIN BY REFERENCE.
Investment in the Shares is highly speculative and subject to numerous
and substantial risks. Therefore, purchase of the Shares is suitable only
for those persons who can afford to lose their entire investment. There is a
minimum public market for the Shares. Prospective purchasers of Shares
should carefully consider the risk factors relating to the business of the
Company including, but not limited to, the risk factors discussed below, and
should consult all the other information provided in this Prospectus
(including the information incorporated by reference) before making any
purchase of Shares.
SUBSTANTIAL LOSSES
During the fiscal years ended June 30, 1995, 1996 and 1997, the Company
sustained losses of $5,411,000, $1,470,000 and $3,698,000, respectively.
While management believes the Company has made sufficient changes to allow it
to return to profitability, there can be no assurance that the Company will
not continue to incur losses.
MATERIAL DISPOSITIONS OF ASSETS
From September 1995 through January 1997 all but one of the Company's
subsidiaries made substantial dispositions of assets and those subsidiaries
were liquidated. While the remaining subsidiary, Vertex Transportation,
Inc., has been profitable during the fiscal years ended 1995, 1996 and 1997,
there can be no assurance that the remaining business of that subsidiary will
continue to be profitable or that some unforeseen liability of the liquidated
subsidiaries will not affect the Company's business, assets, or liabilities
in the future.
MOTOR CARRIER INDUSTRY
The business of the Company's remaining subsidiary, Vertex
Transportation, Inc., includes negotiation of motor carrier transportation
services on a short-term basis and thus is substantially affected by the
availability of such transportation services, as well as by the overall
pricing and other competitive considerations of that industry as compared to
those of alternative transportation industries.
GOVERNMENT REGULATION
Motor Carrier's are subject to regulation by various federal and state
governmental agencies, including the United States Department of
Transportation. These regulatory agencies have broad powers, and the motor
carrier industry is subject to regulatory and legislative changes that can
affect the economics of the industry by requiring changes in the operating
practices or influencing the demand for, and the costs of providing, services
to shippers.
3
<PAGE>
EFFECTS OF FUEL, INSURANCE AND INTEREST RATES
Fuel prices and insurance premiums are expenses over which the Company
has little or no control. If these costs are increased to the Company's
transportation providers, the increases will be passed on to the Company by
increased rates. These increased rates, if not offset, will reduce the
Company's profitability.
ABSENCE OF DIVIDENDS
The Company anticipates that all of its earnings in the foreseeable
future, if any, will be retained for the development and expansion of its
business, and accordingly, has no current plans to pay dividends. Payment of
dividends is within the discretion of the Company's Board of Directors and
will depend, among other factors, upon the Company's earnings, financial
condition, and capital requirements. The Company's subsidiary, which now
conducts substantially all the business operations of the Company, has
line-of-credit agreements which contain provisions limiting the ability of
the subsidiary to pay dividends.
LIQUIDITY AND MARKET PRICE
The Company was de-listed from trading on The Nasdaq SmallCap Market on
August 13, 1996 due to its failure to maintain the necessary equity and other
criteria of The Nasdaq Stock Market. The OTC Bulletin Board on which the
Company's shares are now quoted must be viewed as having very little
liquidity, and any amount of purchasing or selling of Company shares on that
market could cause significant and abrupt price changes in the reported
market prices for the Shares.
COMPETITIVE INDUSTRY
The Company is participating in a highly competitive industry and rates
demanded by competitors directly control the rates for which the Company can
render its services. In the event competitors rates are reduced, any such
reduction will have the effect of reducing the rates of the Company and
thereby reducing the Company's opportunities to earn profits.
MAINTENANCE OF CAPITAL
In order for the Company to attract the necessary transportation
providers, it is necessary for the Company to maintain sufficient capital to
ensure timely and current payment of transportation fees to these providers.
Any reduction of capital below that which is necessary to properly attract
these transportation providers will have a substantial adverse effect on the
profitability of the Company.
GENERAL ECONOMIC RISK
The major risk encountered by a logistics services company is that it
will not generate sufficient income to meet its operating expenses and debt
service. Its net income is entirely dependent upon the continuation of the
service to its customers as well as the existence of available transportation
providers. The net income of the Company may be affected by many factors
including: (a) bad debts, insolvency and bankruptcy of customers; (b)
adverse changes in general economic conditions; (c) adverse changes in
transportation laws; (d) unanticipated increases in operating costs; (e)
increases in transportation and other taxes; and (f) increases in interest
rates on funds borrowed by the Company not offset by increased revenues.
DEPENDENCE ON SIGNIFICANT CUSTOMERS
The success of the Company depends heavily on the business it conducts
with a limited number of significant customers. For the Company's fiscal
years ending June 30, 1996 and 1997, approximately 25%, and 10% of its net
sales were derived from sales to its two largest customers. The Company has
had long-standing relationships with most of its significant customers;
however, it generally does not have long-term contracts with them and they
may unilaterally reduce or discontinue the purchase of the Company's products
without penalty. The Company's loss of (or the failure to retain a
significant amount of business with) any of its significant customers could
have a material adverse effect on the Company.
USE OF PROCEEDS
The Shares being offered are for the account of the Selling Shareholders.
Accordingly, the Company will receive none of the proceeds from the sale of
the Shares.
4
<PAGE>
PLAN OF DISTRIBUTION
The Shares offered hereby are being sold by the Selling Shareholders
acting as principal for their own accounts. The Company will receive none of
the proceeds from this offering.
The distribution of the Shares by the Selling Shareholders is not subject
to any underwriting agreement. The Company expects that the Selling
Shareholders will sell their shares covered by this Prospectus through
customary brokerage channels, either through broker-dealers acting as agents
or brokers for the Selling Shareholders, or through broker-dealers acting as
principals, who may then resell their Shares in the over-the-counter market,
or at private sales or otherwise. The Selling Shareholders may sell Shares in
such transactions at market prices prevailing at the time of sale, at prices
related to the prevailing market prices, or at negotiated prices. The
Selling Shareholders may effect such transactions by selling Shares through
broker-dealers, and such broker-dealers will receive compensation in the form
of underwriting discounts, concessions, or commissions from the Selling
Shareholders and/or the purchasers of the Shares for whom they may act as
agent (which compensation may be in excess of customary commissions). The
Selling Shareholders and any broker-dealers that participate with the Selling
Shareholders in the distribution of the Shares may be deemed to be
underwriters and any commissions received by such broker-dealers and any
profit on resale of Shares sold by them might be deemed to be underwriting
discounts or commissions under the Securities Act. All expenses of
registration incurred in connection with this offering are being borne by the
Company, but all brokerage commissions and other similar expenses incurred by
the Selling Shareholders will be borne by the Selling Shareholders.
At the time a particular offer of Shares is made, to the extent required,
a supplement to this Prospectus will be distributed which will identify and
set forth the aggregate amount of Shares being offered and the terms of the
offering, including the name or names of any underwriters, dealers or agents,
the purchase price paid by any underwriters for Shares purchased from the
Selling Shareholders, any discounts, commissions and other items constituting
compensation from the Selling Shareholders and any discounts, commissions or
concessions allowed or reallowed or paid to dealers, including the proposed
selling price to the public.
The Selling Shareholders are not restricted as to the price or prices at
which they may sell their Shares. Sales of Shares at less than market prices
may depress the market price of the Company's Common Stock. Moreover, the
Selling Shareholders are not restricted as to the number of Shares which may
be sold at any one time, and it is possible that a significant number of
Shares could be sold at the same time.
Under applicable rules and regulations under the Exchange Act, any person
engaged in a distribution of the Shares may not simultaneously engage in
market making activities with respect to the Shares for a period of nine
business days prior to the commencement of such distribution. In addition
and without limiting the foregoing, the Selling Shareholders will be subject
to the applicable provisions of the Exchange Act and the rules and
regulations thereunder, including without limitation Regulation M (which now
incorporates provisions previously contained in rules 10b-2, 10b-6, and
10b-7), which provisions may limit the timing of purchases and sales of the
Shares by the Selling Shareholders.
In order to comply with certain states' securities laws, if applicable,
the Shares may be sold in such jurisdictions only through registered or
licensed brokers or dealers. In certain states the Shares may not be sold
unless the Shares have been registered or qualified for sale in such state,
or unless an exemption from registration or qualification is available and is
obtained.
The Company has agreed to indemnify the Selling Shareholders against
certain liabilities, including liabilities under the Securities Act.
5
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Exchange
Act, and in accordance therewith files reports, proxy statements and other
information with the Securities and Exchange Commission ("Commission"). Such
reports, proxy statements and other information filed by the Company may be
inspected and copied (at prescribed rates) at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549 and the following regional offices of the Commission:
7 World Trade Center, Suite 1300, New York, New York 10048 and Northwestern
Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661.
In addition, such reports, proxy statements and other information can be
obtained from the Commission's web site at http://www.sec.gov. Quotations
relating to the Common Stock appear on the OTC Bulletin Board. Such reports,
proxy statements and other information concerning the Company can also be
inspected at the offices of the National Association of Securities Dealers,
Inc., 1735 K Street, N.W., Washington, D.C. 20006.
A COPY OF THE COMPANY'S LATEST FORM 10-K ANNUAL REPORT AND ITS QUARTERLY
REPORT ON FORM 10-Q FOR THE THREE MONTH PERIOD ENDED SEPTEMBER 30, 1997 FILED
WITH THE COMMISSION ARE REQUIRED TO BE DELIVERED WITH THIS PROSPECTUS.
The Company has filed with the Commission a Registration Statement on
Form S-2 (the "Registration Statement") under the Securities Act, with
respect to the shares of Common Stock offered hereby (the "Shares"). This
Prospectus, which is a part of the Registration Statement, does not contain
all the information set forth in, or annexed as exhibits to, that
Registration Statement, certain portions of which have been omitted pursuant
to rules and regulations of the Commission. For further information with
respect to the Company and the Shares offered hereby, reference is hereby
made to that Registration Statement, including the exhibits thereto. Copies
of the Registration Statement, including exhibits, may be obtained from the
aforementioned public reference facilities of the Commission upon payment of
the prescribed fees, or may be examined without charge at those facilities.
Statements contained herein concerning any document filed as an exhibit are
not necessarily complete and, in each instance, reference is made to the copy
of the document filed as an exhibit to the Registration Statement. Each such
statement is qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed or to be filed by the Company with the
Commission under the Exchange Act are incorporated by reference in and made a
part of this Prospectus:
(a) the Company's Annual Report on Form 10-K for the fiscal year ended
June 30, 1997 (A copy of the Company's latest Form 10-K is required to
be delivered with this Prospectus.)
(b) the Company's Quarterly Report on Form 10-Q for the three month period
ended September 30, 1997 (A copy of the Company's Form 10-Q is
required to be delivered with this Prospectus.)
(c) all documents filed by the Company pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date hereof
and prior to the termination of this offering (which shall be deemed
to be incorporated by reference herein and to be a part hereof
from the date of filing of such documents).
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained
herein, or in any other subsequently filed documents, which are also
incorporated or deemed to be incorporated by reference herein, modifies or
supersedes such statement. Any such statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a
part of this Prospectus.
This Prospectus incorporates documents by reference which are not
presented herein or delivered herewith. The Company hereby undertakes to
provide, without charge, to each person, including any beneficial owner, to
whom a copy of this Prospectus is delivered, on the written or oral request
of each such person, a copy of any or all the information incorporated herein
by reference. Exhibits to any of such documents, however, will not be
provided unless the exhibits are specifically incorporated by reference into
such documents. The requests should be addressed to the Company's principal
executive offices: Attn: Secretary, 119 Despatch Drive, East Rochester, New
York 14445, telephone number (716) 381-5470.
6
<PAGE>
SELLING SHAREHOLDERS
The following table sets forth certain information concerning the
beneficial ownership of the Common Stock as of October 31, 1997 and as
adjusted to reflect the sale of 3,288,000 Shares of Common Stock by the
Selling Shareholders.
<TABLE>
<CAPTION>
Shares Beneficially
Shares Beneficially Owned Shares to be Offered for Owned at Completion
Prior to Offering (1) Sale by Selling Shareholders of Offering
---------------------- ---------------------------- -----------
Name of Beneficial Owner Number Percent Number Number Percent
- ------------------------ ------ ------- ------ ------ -------
<S> <C> <C> <C> <C> <C>
Arabella 570,000 13.42% 500,000 70,000 1.65%
c/o Privatim Finance Ag.
ROI Partners 332,100 7.82% 300,000 32,100 *
Microcap Partners 52,000 1.22% 50,000 2,000 *
ROI + Lane L/P 62,700 1.48% 60,000 2,700 *
Pleiades Investment Partners 50,000 1.18% 50,000 - -
NAVLLC 20,000 * 18,000 2,000 *
ROI Offshore Fund Ltd 115,640 2.72% 100,000 15,640 *
Mark Boyer (2) 86,000 2.02% 80,000 6,000 *
Louis Fenn 50,000 1.18% 50,000 - *
Barry Plost 204,843 4.82% 150,000 54,843 1.29%
Siam Partners II 106,667 2.51% 100,000 6,667 *
Tahoe Partnership I 106,667 2.51% 100,000 6,667 *
E&MRP Trust 206,667 4.86% 200,000 6,667 *
Special Situations Fund III LP 800,000 18.83% 800,000 - *
Special Situations Cayman Fund LP 293,000 6.90% 200,000 93,000 2.19%
Special Situations Private Equity
Fund LP - 500,000 11.77% 500,000 - -
Timothy Lepper (3)(5) 100,960 2.38% 15,000 85,960 2.02%
Wayne N. Parry (4)(5) 74,400 1.76% 15,000 59,400 1.81%
</TABLE>
The number of Shares which may actually be sold by the Selling
Shareholders will be determined from time to time by the Selling Shareholders
and will depend upon a number of factors, including the price of the
Company's Common Stock from time to time. Because the Selling Shareholders
may sell all or none of the Shares that they hold and because the offering
contemplated by this Prospectus is not being underwritten, no estimate can be
given as to the number of Shares that will be held by the Selling
Shareholders upon termination of the offering. See "Plan of Distribution."
(1) For all shares listed, each person possesses both sole voting and
investment power.
[Footnotes continued on next page]
7
<PAGE>
(2) Mark Boyer has been a Director of the Company since 1994.
(3) Timothy Lepper has been President, Chief Executive Officer and a Director
of the Company since 1995. Mr. Lepper was also previously President of the
Company's subsidiary, Vertex Transportation, Inc. from before its
acquisition by the Company in 1994.
(4) Wayne N. Parry has been a Director of the Company since 1994 and Secretary
of the Company since 1996. Mr. Parry also has succeeded Mr. Lepper as
President of the Company's subsidiary, Vertex Transportation, Inc.
(5) Does not include 425,000 Shares issuable to Timothy Lepper and 425,000
Shares issuable to Wayne N. Parry at $0.15 per Share under outstanding
options which expire on May 1, 2002.
*Represents less than 1% of the Company's outstanding Shares.
DESCRIPTION OF CAPITAL STOCK
AUTHORIZED AND OUTSTANDING CAPITAL STOCK
The authorized capital stock of the Company presently consists of
30,000,000 shares of common stock, par value $0.10 per share (the "Common
Stock") and 5,000,000 shares of preferred stock, par value $0.01 per share
(the "Preferred Stock"). The following description of the Common Stock and
Preferred Stock is qualified in its entirety by reference to the Company's
Amended and Restated Certificate of Incorporation and By-laws, which are
filed as exhibits to the Registration Statement of which this Prospectus is a
part.
COMMON STOCK
As of the date of this Prospectus, there were 4,248,117 issued and
outstanding shares of Common Stock and outstanding options to purchase
850,000 shares of Common Stock. The options were issued to Timothy Lepper
and Wayne N. Parry, the Company's two senior officers and expire on May 1,
2002. Each holder of Common Stock is entitled to one vote for each share
held. The holders of Common Stock, voting as a single class, are entitled to
elect all of the directors of the Company.
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
therefor. In the event of a liquidation, dissolution or winding up of the
Company, holders of Common Stock would be entitled to share ratably in the
Company's assets remaining after payment of liabilities and the satisfaction
of any liquidation preference granted to the holders of any outstanding
shares of Preferred Stock. Holders of Common Stock have no preemptive or
other subscription rights. The shares of Common Stock are not convertible
into any other security. The outstanding shares of Common Stock are, and the
shares being offered hereby will be, upon issuance and sale, fully paid and
nonassessable.
DELAWARE LAW
The Company is subject to the provisions of Section 203 of the Delaware
General Corporation Law ("Delaware Law"), an anti-takeover law. In general,
the statute prohibits a publicly held Delaware corporation from engaging in a
"business combination" with an "interested stockholder" for a period of three
years after the date that the person became an interested stockholder unless
(with certain exceptions) the business combination or the transaction in
which the person became an interested stockholder is approved in a prescribed
manner. Generally, a "business combination" includes a merger, asset or stock
sale, or other transaction resulting in a financial benefit to the
stockholder. Generally, an "interested stockholder" is a person who, together
with affiliates and associates, owns (or within three years prior, did own)
15% or more of a corporation's outstanding voting stock. This provision may
have the effect of delaying, deferring or preventing a change in control of
the Company without further action by the stockholders.
CERTAIN PROVISIONS OF THE COMPANY'S AMENDED AND RESTATED CERTIFICATE OF
INCORPORATION AND BYLAWS
Set forth below is a description of such provisions of the Company's
Amended and Restated Certificate of Incorporation and Bylaws. Such
description is intended as a summary only and is qualified in its entirety by
reference to the Company's Amended and Restated Certificate of Incorporation
and Bylaws, which are included as exhibits to the Registration Statement of
which this Prospectus forms a part.
NUMBER OF DIRECTORS AND AMENDMENT. The Bylaws provide that there shall
be no less than three nor more than seven directors sitting on the Board of
Directors and that the number of directors shall be fixed by majority
approval of the Board of Directors or by a vote of a majority of the
stockholders of the Company. Currently, the number of directors is set at
three. In addition, the Bylaws provide that such provision establishing the
number of directors may only be amended by a vote of a majority of the
stockholders of the Company or by majority approval of the Board of
Directors.
8
<PAGE>
SPECIAL STOCKHOLDER MEETINGS. The Bylaws provide that special meetings
of the stockholders, for any purpose or purposes, unless required by law,
shall be called by the President, or by the President or Secretary if
requested in writing by a majority of the entire Board of Directors or by
stockholders owning not less than 50% of the entire voting stock of the
Company then issued and outstanding. A special meeting may not be held
absent a call by the President or such a written request. The request shall
state the purpose or purposes of the proposed meeting. Such limitation on
the right of stockholders to call a special meeting could make it more
difficult for stockholders to initiate action that is opposed by the Board of
Directors. Such action on the part of stockholders could include the removal
of an incumbent director, the election of a stockholder nominee as a
director, or the implementation of a rule requiring stockholder ratification
of specific defensive strategies that have been adopted by the Board of
Directors with respect to unsolicited takeover bids. In addition, the
limited ability of the stockholders to call a special meeting of stockholders
may make it more difficult to change existing Board of Directors and
management.
PREFERRED STOCK. The Amended and Restated Certificate of Incorporation
authorizes the Company's Board to establish one or more series of Preferred
Stock and to determine, with respect to any series of Preferred Stock, the
rights, preferences, privileges and restrictions thereof. No shares of
Preferred Stock are issued or outstanding. The Company believes that the
ability to issue Preferred Stock will provide the Company with increased
flexibility in structuring possible future financings and acquisitions, and
in meeting other corporate needs that might arise. Having such authorized
shares available for issuance will allow the Company to issue shares of
Preferred Stock without the expense and delay of a special stockholders'
meeting. The authorized shares of Preferred Stock, as well as shares of the
Company's Common Stock, will be available for issuance without further action
by stockholders, unless such action is required by applicable law or the
rules of any stock exchange on which the Company's securities may be listed.
Although the Company's Board of Directors has no intention at the present
time of doing so, it could issue a series of Preferred Stock, the terms of
which, subject to certain limitations imposed by the securities laws, could
impede the completion of a merger, tender offer or other takeover attempt.
The Company's Board of Directors will make any determination to issue such
shares based on its judgments as to the best interests of the Company and its
stockholders at the time of issuance. The Company's Board of Directors, in
so acting, could issue Preferred Stock having terms which could discourage an
acquisition attempt or other transaction that some, or a majority, of the
stockholders might believe to be in their best interests or in which
stockholders might receive a premium for their stock over the then market
price of such stock.
LEGAL MATTERS
Certain legal matters with respect to the Common Stock offered hereby
will be passed upon for the Company by Holtzberg & Conway, East Rochester,
New York.
EXPERTS
The consolidated financial statements and financial statement schedules
of the Company as of June 30, 1996 and 1997 incorporated herein by reference
from the Company's Annual Report on Form 10-K for the year ended June 30,
1997 have been included herein and incorporated by reference in reliance on
the report of Hein + Associates, LLP, independent accountants, given on the
authority of that firm as experts in accounting and auditing.
9
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The Company and the Selling Shareholders will pay all of the expenses
incurred in connection with the offering described in this registration
statement. Those expenses are estimated to be as follows:
<TABLE>
<CAPTION>
To be Paid To be Paid
by the by the Selling
Company Shareholders
------- ------------
<S> <C> <C>
Securities and Exchanges Commission registration fee................ $ 1,316 $ --
Legal fees and expenses............................................. 10,000 --
Printing expenses................................................... 10,000 --
Fees and expenses (including legal fees) for
qualification under state securities laws.......................... 5,000 --
Accounting fees and expenses........................................ 3,000 --
Miscellaneous....................................................... 2,000 --
Total............................................................. 31,316 --
</TABLE>
Except for the Securities and Exchange Commission filing fees, all
expenses are estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the General Corporation Law of the State of Delaware (the
"Delaware Law") empowers a Delaware corporation to indemnify any persons who
are, or are threatened to be made, parties to any threatened, pending or
completed legal action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of
the corporation), by reason of the fact that such person is or was an officer
or director of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation
or enterprise. The indemnity may include expenses (including attorneys
fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by the person in connection with such action, suit or
proceeding, provided that the officer or director acted in good faith and in
a manner he reasonably believed to be in or not opposed to the corporation's
best interests, and for criminal proceedings, had no reasonable cause to
believe his conduct was unlawful. A Delaware corporation may indemnify
officers and directors in an action or suit by or in the right of the
corporation under the same conditions against expenses (including attorney's
fees) actually and reasonably incurred by the person in connection with the
defense or settlement of such action or suit, except that no indemnification
is permitted without judicial approval if the officer or director is adjudged
to be liable to the corporation. When an officer or director is successful
on the merits or otherwise in the defense of any action referred to above,
the corporation must indemnify him against the expenses which the officer or
director actually and reasonably incurred.
Article III, Section 13 of the Company's By-Laws provides that the
Company shall indemnify its directors and officers against liabilities and
expenses which they may incur as directors and officers of the Company to the
extent the corporation is empowered to provide such indemnification in
accordance with the Delaware Law.
Section 145 of the Delaware Law also contains provisions authorizing a
corporation to obtain insurance on behalf of any director and officer against
liabilities, whether or not the corporation would have the power to indemnify
against such liabilities. The Company currently does not maintain insurance
coverage for the directors and officers of the Company.
The directors and officers of the Company are entitled to indemnification
by each Selling Shareholder against any cause of action, loss, claim, damage
or liability to the extent it arises out of or is based upon any untrue
statement or alleged untrue statement or omission or alleged omission made in
this Registration Statement and the Prospectus contained herein, as the same
shall be amended or supplemented, made in reliance upon and in conformity
with written information furnished by the Selling Shareholders expressly for
use in connection with the Registration Statement.
II-1
<PAGE>
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------
<S> <C>
5.1 Opinion of Holtzberg & Conway
23.1 Consent of Holtzberg & Conway (contained in Exhibit 5.1 hereto)
23.2 Consent of Hein + Associates LLP
24.1 Power of Attorney [Previously filed]
</TABLE>
ITEM 17. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a) (3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high and of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission pursuant
to Rule 424(b) if, in the aggregate, the changes in volume and price
represent no more than a 20 percent change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the
effective registration statement.
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement
or any material change to such information in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial BONA FIDE offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
the registrant's annual report pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement 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.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers, and
controlling persons of the Registrant pursuant to the foregoing provisions,
or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act of 1933 and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer, or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer of controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of 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 of 1933 and will be
governed by the final adjudication of such issue.
(d) The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities
Act of 1933, the information omitted from the form of prospectus filed as
part of this registration statement in reliance upon Rule 430A and contained
in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act of 1933 shall be deemed to be part of
this registration statement as of the time it was declared effective.
II-2
<PAGE>
(2) For the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a form of
prospectus 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.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-2 and has duly caused this Amendment to the
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the Village of East Rochester, State of New
York, on this 9th day of December, 1997.
COUNTRY WIDE TRANSPORT SERVICES, INC.
By: /s/ Timothy Lepper
----------------------------------
Timothy Lepper, President and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1993, this
Amendment to the Registration Statement has been signed by the following
persons in the capacities and on the dates indicated:
<TABLE>
<CAPTION>
Name Title Date
---- ----- ----
<S> <C> <C>
/s/ Timothy Lepper Chairman, President, Chief Executive December 9, 1997
- ------------------
Timothy Lepper Officer, Principal Financial Officer,
Principal Accounting Officer and
Director
/s/ Wayne N. Parry Director December 9, 1997
- ------------------
Wayne N. Parry
*Mark Boyer Director December 9, 1997
- ------------------
Mark Boyer
</TABLE>
*/ By: /s/ Timothy Lepper
-------------------------------
Timothy Lepper, as attorney-in-fact
for Mark Boyer.
II-4
<PAGE>
HOLTZBERG LAW FIRM
Richard H. Holtzberg, Esq.
Suite 3000 Piano Works
East Rochester, New York 14445
(716)385-3300
Fax (716) 387-0385
November 18, 1997
Country Wide Transport Services, Inc.
119 Despatch Drive
East Rochester, New York 14445
Re: Proposed Registration Under the Securities Act of 1933 of
3,288,000 shares of Common Stock
Gentlemen:
We are counsel for Country Wide Transport Services, Inc. (the "Company"),
a Delaware corporation, in connection with the proposed registration of
3,288,000 shares of Common Stock (the "Shares") by the Company as described
in the Registration Statement ("Registration Statement") on Form S-2
(Registration No. 333-31581) filed by the Company with the Securities and
Exchange Commission under the Securities Act of 1933, as amended.
We have examined the Registration Statement, the originals or copies
certified or otherwise identified to our satisfaction of the Certificate of
Incorporation of the Company, the Bylaws or the Company, as currently in
effect, and the minute books of the Company. In that examination we have
assumed the genuineness of all signatures, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as certified or photostatic copies and the
authenticity of the originals of such latter documents. As to any facts
material to this opinion which were not independently established, we have
relied upon statements of representatives or officials of the Company and
others.
Based on the foregoing, we are of the opinion that :
(1) The Company is duly organized and validly existing under the laws of
the State of Delaware.
(2) The Shares have been duly authorized, and when sold as described in
the Registration Statement, will be legally issued, fully paid and
non-assessable.
We hereby consent to the filing of this opinion as an Exhibit to the
aforementioned Registration Statement and any amendment thereto and to the
use of our
<PAGE>
name under the caption "Legal Matters" in the Prospectus forming a part of
the Registration Statement.
Very truly yours,
Holtzberg Law Firm
/s/Richard H. Holtzberg
----------------------------------
Richard H. Holtzberg
2
<PAGE>
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT
We hereby consent to the use in this Registration Statement on Form S-2
of our report dated August 20, 1997 relating to the consolidated financial
statements and financial statements schedule of County Wide Transport
Services, Inc. and subsidiaries and to the incorporation by reference of such
report included in the Company's 1997 annual report on Form 10-K, and to the
reference to our Firm under the caption "Experts" in the Prospectus.
/s/ Hein + Associates LLP
-------------------------
Hein + Associates LLP
Certified Public Accountants
Orange, California
December 2, 1997
