<PAGE>
PROSPECTUS
TETRA TECH, INC.
56,848 SHARES OF COMMON STOCK
---------------
The 56,848 shares (the "Shares") of Common Stock, par value $.01
per share ("Common Stock"), of Tetra Tech, Inc. ("Tetra Tech" or the
"Company") offered hereby are to be sold by the persons named herein under
"Selling Stockholders."
INVESTORS SHOULD CONSIDER THE INFORMATION SET FORTH IN THIS
PROSPECTUS BEGINNING ON PAGE 5 UNDER "RISK FACTORS" PRIOR TO PURCHASE.
Holders of the Shares may resell the Shares from time to time in
transactions on the Nasdaq National Market, and may sell the Shares through a
broker or brokers or in the over-the-counter market at prices prevailing on
such exchange or over-the-counter market, as appropriate, at the times of
such sales. The Selling Stockholders may also make private sales directly or
through such broker or brokers. See "Plan of Distribution." Sales of the
Shares may be effected by selling such securities to or through
broker-dealers, and such broker-dealers may receive compensation in the form
of discounts, concessions or commissions from the sellers thereof. Such
sellers and any broker-dealer who acts in connection with the sales of Shares
may be deemed to be "underwriters" as that term is defined in the Securities
Act of 1933, as amended (the "Securities Act"), and any commissions received
by them and profit on any resale of the Shares might be deemed to be
underwriting discounts and commissions under the Securities Act.
None of the proceeds from the sale of the Shares will be received
by the Company. The Company has agreed to bear all expenses (other than
underwriting discounts and selling commissions and fees and expenses of
counsel and other advisors to the Selling Stockholders) in connection with
the registration and sale of the Shares being registered hereby. See "Plan
of Distribution."
---------------
The Common Stock is traded on the Nasdaq National Market under the
symbol "WATR." On August 31, 1998, the reported closing price of the Common
Stock on the Nasdaq National Market was $20 7/8 per share.
---------------
THESE SECURITIES 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.
---------------
No dealer, salesman or other person has been authorized to give any
information or to make any representations not contained or incorporated by
reference in this Prospectus, and, if given or made, such information or
representations must not be relied upon as having been authorized by the
Company or by any other person. All information contained in this Prospectus
is as of the date of this Prospectus. Neither the delivery of this
Prospectus nor any sale made hereunder shall, under any circumstances, create
any implication that there has been no change in the affairs of the Company
or in the facts herein set forth since the date hereof. This Prospectus does
not constitute an offer to sell or a solicitation of any offer to buy any
security other than the securities covered by this Prospectus, nor does it
constitute an offer to or solicitation of any person in any jurisdiction in
which such offer or solicitation may not lawfully be made.
---------------
THE DATE OF THIS PROSPECTUS IS SEPTEMBER 1, 1998
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, and the rules and regulations thereunder,
and in accordance therewith files reports, proxy statements and other
information with the Securities and Exchange Commission (the "Commission").
Reports, proxy statements and other information filed by the Company with the
Commission can be inspected and copied at the public reference facilities
maintained by the Commission at Room 1024, Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549 and at the following Regional Offices of the
Commission: Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661; and Seven World Trade Center, 13th Floor, New York, New York
10048. Copies of such material can be obtained by mail from the Public
Reference Section of the Commission at Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549 at prescribed rates. Such reports, proxy
statements and other information concerning the Company are also available
for inspection at the offices of The Nasdaq Stock Market, 1735 K Street,
N.W., Washington, D.C. 20006. In addition the Commission maintains an
Internet site at http://www.sec.gov that contains reports, proxy and
information statements and other information regarding registrants, including
the Company, that file electronically with the Commission.
The Company has filed with the Commission a registration statement
on Form S-3 (together with all exhibits, schedules, amendments, and
supplements thereto, the "Registration Statement") under the Securities Act
with respect to the Common Stock offered by this Prospectus. This
Prospectus, which forms a part of the Registration Statement, does not
contain all the information set forth in the Registration Statement (certain
parts of which have been omitted in accordance with the rules and regulations
of the Commission). For further information with respect to the Company and
the Common Stock, reference is made to the Registration Statement.
Statements contained in this Prospectus as to the contents of any contract,
agreement or other document 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 being qualified in all
respects by reference to such exhibit. The Registration Statement may be
inspected and copied at the public reference facilities at the Commission's
offices at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549, and at the Commission's Regional Offices at: Citicorp Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661 and Seven World
Trade Center, 13th Floor, New York, New York 10048. Copies of all or any
part thereof may be obtained from such office upon payment of prescribed fees.
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
This Prospectus incorporates by reference certain documents
relating to the Company which are not delivered herewith. These documents
(other than the exhibits to such documents, unless such exhibits are
specifically incorporated by reference into such documents) are available
without charge, upon oral or written request by any person, including any
beneficial owner, to whom this Prospectus is delivered, from the Company, 670
N. Rosemead Boulevard, Pasadena, California 91107-2190, telephone number
(626) 351-4664, Attention: Richard A. Lemmon, Vice President and Secretary.
The following documents have been filed with the Commission
pursuant to the Exchange Act (File No. 0-11695) and are incorporated in this
Prospectus by reference and are made a part hereof:
1. Annual Report on Form 10-K for the fiscal year ended
September 28, 1997 (the "Tetra Tech 10-K"), as filed with the
Commission on December 26, 1997;
2. Quarterly Report on Form 10-Q for the fiscal quarter ended
December 28, 1997, as filed with the Commission on February 10, 1998;
3. Quarterly Report on Form 10-Q for the fiscal quarter ended
March 29, 1998, as filed with the Commission on May 13, 1998;
4. Quarterly Report on Form 10-Q for the fiscal quarter
ended June 29, 1998, as filed with the Commission on August 11, 1998;
5. Current Report on Form 8-K for event of December 31, 1997,
as filed with the Commission on January 15, 1998;
6. Current Report on Form 8-K/A (Amendment No. 1) for event of
December 31, 1997, as filed with the Commission on March 16, 1998;
7. The portions of Tetra Tech's Proxy Statement for the Annual
Meeting of Stockholders held on February 11, 1998 that have been
incorporated by reference into the Tetra Tech 10-K, as filed with the
Commission on January 9, 1998;
8. The portions of Tetra Tech's Annual Report to Stockholders
for the fiscal year ended September 28, 1997 that have been
incorporated by reference into the Tetra Tech 10-K, as filed with the
Commission on December 26, 1997; and
9. The description of the Company's Common Stock which is
contained in the Registration Statement on Form 8-A, filed with the
Commission on November 13, 1991, including any amendments or reports
filed for the purpose of updating such description.
All documents and reports filed by the Company pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of the offering of the Common Stock
shall be deemed to be incorporated by reference in this Prospectus and shall
be a part hereof from the date of filing of such documents. Any statement
contained in this Prospectus or 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 subsequently filed document that also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
3
<PAGE>
RISK FACTORS
AN INVESTMENT IN THE SHARES OF COMMON STOCK OFFERED BY THIS
PROSPECTUS INVOLVES A HIGH DEGREE OF RISK. PROSPECTIVE PURCHASERS OF THE
COMMON STOCK OFFERED HEREBY SHOULD CAREFULLY REVIEW THE FOLLOWING RISK
FACTORS AS WELL AS THE OTHER INFORMATION SET FORTH IN THIS PROSPECTUS.
THIS PROSPECTUS, INCLUDING THE INFORMATION SET FORTH BELOW,
CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION 27A OF THE
SECURITIES ACT OF 1933, AS AMENDED, AND SECTION 21E OF THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED, AND ARE INTENDED TO BE COVERED BY THE SAFE
HARBORS CREATED THEREBY. PROSPECTIVE PURCHASERS ARE CAUTIONED THAT ALL
FORWARD-LOOKING STATEMENTS ARE SUBJECT TO RISKS AND UNCERTAINTIES, INCLUDING,
WITHOUT LIMITATION, THE RISKS OUTLINED IN THIS SECTION.
POTENTIAL LIABILITY AND INSURANCE. Because of the type of projects
in which the Company is or may be involved, the Company's current and
anticipated future services may involve risks of potential liability under
Superfund, common law or contractual indemnification agreements. It is
difficult to assess accurately the magnitude of potential risks to the
Company.
The Company maintains two comprehensive general liability policies,
both in the amount of $1,000,000. These amounts, together with two
$9,000,000 umbrella policies, provide total general liability coverage of
$10,000,000 for the Company's resource management and infrastructure business
segments and coverage of $10,000,000 for its telecommunications business
segment. The Company's professional liability insurance ("E&O") policy,
which includes pollution coverage, for 1998 provides $10,000,000 in coverage
for resource management and infrastructure business segments, with a $100,000
self-insured retention. The same E&O policy covers the telecommunications
segment with a sublimit of $1,000,000 for each claim and $1,000,000 in the
aggregate. The Company procures insurance coverage through a broker who is
experienced in the engineering field. The broker, together with the Company's
Risk Manager, review the Company's risk/insurance programs with those of the
Company's competitors and clients. This review, combined with historical
experience, claims history and contractual requirements, allows the Company
to determine the adequate amount of insurance. However, because there are
various exclusions and retentions under the Company's insurance policies,
there can be no assurance that all liabilities that may be incurred by the
Company are subject to insurance coverage. In addition, the E&O policy is a
"claims made" policy which only covers claims made during the term of the
policy. If a policy terminates and retroactive coverage is not obtained, a
claim subsequently made, even a claim based on events or acts which occurred
during the term of the policy, would not be covered by the policy. In the
event the Company expands its services into new markets, no assurance can be
given that the Company will be able to obtain insurance coverage for such
activities or, if insurance is obtained, that the dollar amount of any
liabilities incurred in connection with the performance of such services will
not exceed policy limits. The premiums to be paid by the Company for its E&O
policies during fiscal 1998 are approximately $890,000.
The Company evaluates and determines the risk associated with
uninsured claims. In the event the Company determines that an uninsured claim
has potential liability, the Company establishes an appropriate reserve. The
Company does not establish a reserve if it determines that the claim has no
merit. The Company's historical levels of insurance coverage and reserves
have been shown to be adequate. However, a partially or completely uninsured
claim, if successful and of significant magnitude, could have a material
adverse effect on the Company.
SIGNIFICANT COMPETITION. The market for the Company's services is
highly competitive. The Company competes with many other firms, ranging from
small local firms to large national firms having greater financial and
marketing resources than the Company. The Company performs engineering and
consulting services across a broad spectrum of business areas, primarily in
the resource management, infrastructure, and the telecommunication service
business areas. Services within these business areas are provided to a client
base including Federal (Departments of Defense, Interior and Energy; U.S.
Environmental Protection Agency; and the U.S. Postal Service), state and
local agencies, as well as the commercial sector. The range of competitors
for any one procurement can vary from ten to 100 firms, depending upon the
relative value of the project, the financial terms and risks associated with
the work, and any restrictions placed upon competition by the customer.
Historically, competition has been based primarily on the quality and
timeliness of service. However, the Company believes that price has become
an increasingly important competitive factor. The Company believes that its
principal competitors include Dames & Moore, Inc., E.A. Engineering Science &
Technology, ICF Kaiser International, Inc., International Technology Corp.,
TRC Companies, Inc., URS Consultants, Inc., Roy F. Weston, Inc., Castle Tower
Corporation and OSP Consultants, Inc.
CONTRACTS. The Company's contracts with Federal and State
governments and some of its other client contacts are subject to termination
at the discretion of the client. Some contracts made with the Federal
government are subject to annual approval of funding and audits of the
Company's rates. Limitations imposed on spending by Federal government
agencies may limit the continued funding of the Company's existing contracts
with the Federal government
4
<PAGE>
and may limit the Company's ability to obtain additional contracts. These
limitations, if significant, could have a material adverse effect on the
Company.
All of the Company's contracts with the Federal government are
subject to audit by the government, primarily by the Defense Contract Audit
Agency (the "DCAA"), which reviews the Company's overhead rates, operating
systems and cost proposals. During the course of its audit, the DCAA may
disallow costs if it determines that the Company improperly accounted for
such costs in a manner inconsistent with Cost Accounting Standards. A
disallowance of costs by the DCAA could have a material adverse effect on the
Company. Historically, the Company has not had any material cost
disallowances by the DCAA as a result of audit, except as further described.
There can be no assurance that DCAA audits will not result in material cost
disallowances in the future. The Company's government contracts are also
subject to renegotiation of profits in the event of a change in the
contractual scope of work to be performed.
In September 1995, the Company acquired Tetra Tech EM Inc.
(formerly known as PRC Environmental Management, Inc.; "EMI"). EMI likewise
contracts with the Federal government and such contracts are subject to the
same auditing standards as those of the Company. Audits and negotiations for
the years 1987 through 1993 have recently been completed and cost
disallowances as a result of audit and negotiation totaled approximately
$2,900,000. At the time of acquisition, reserves for such cost disallowances
were established. The Company does not believe that the ultimate resolution
of such audits and disallowances will have a material adverse effect on the
Company. Audits for the years 1994 and 1995 have yet to be completed.
The Company enters into various contracts with its clients, which
include fixed-price contracts. To date, in fiscal 1998, 24.9% of the
Company's net revenue was derived from fixed-price contracts. Under a
fixed-price contract, the customer agrees to pay a specified price for the
Company's performance of the entire contract. Fixed-price contracts carry
inherent risks, including risks of losses from underestimating costs,
problems with new technologies and economic and other changes that may occur
over the contract period. Losses under fixed-price contracts, should they
occur, could have a material adverse effect on the Company.
The Company contracts with both domestic and international
customers. Certain contracts with international customers are denominated in
a currency other than the U.S. dollar. Contracts denominated in any currency
other than the U.S. dollar contain certain inherent risks, including risks on
foreign currency translation and risks in expatriating funds from foreign
countries. To date, in fiscal 1998, 2.3% of the Company's net revenue was
derived from the international marketplace, compared to 3.7% for fiscal 1997.
As the Company's net revenue derived from the international marketplace
increases, so do the risks associated in realizing the full contract value of
those contracts denominated in foreign currencies. The Company is currently
evaluating options to hedge future potential losses from foreign currency
transactions.
CONFLICTS OF INTEREST. Many of the Company's clients are concerned
about potential or actual conflicts of interest in retaining environmental
consultants and engineers. For example, Federal government agencies have
formal policies against continuing or awarding contracts that would create
actual or potential conflicts of interest with other activities of a
contractor. These policies, among other things, may prevent the Company in
certain cases from bidding for or performing contracts resulting from or
relating to certain work the Company has performed for the government. In
addition, services performed for a private client may create a conflict of
interest which precludes or limits the Company's ability to obtain work from
other public or private entities. The Company has, on occasion, declined to
bid on a project because of an actual or potential conflict of interest.
POTENTIAL VOLATILITY OF STOCK PRICE. The market price of the
Company's Common Stock may be significantly affected by factors such as
quarter-to-quarter variations in the Company's results of operations, changes
in environmental legislation and changes in investors' perception of the
business risks and conditions in the environmental services business. In
addition, market fluctuations, as well as general economic or political
conditions, may adversely affect the market price of the Company's Common
Stock, regardless of the Company's actual performance.
QUALIFIED PROFESSIONALS. The Company's ability to attract and
retain qualified scientists and engineers is an important factor in
determining the Company's future growth and success. The market for
environmental professionals is competitive and there can be no assurance that
the Company will continue to be successful in its efforts to attract and
retain such professionals.
TETRA TECH, INC.
Through a network of more than 100 offices, Tetra Tech provides
comprehensive resource management, infrastructure and telecommunications
support services including research and development, applied science and
management consulting, engineering and architectural design, construction
management, and operation and maintenance. Tetra Tech provides these
services to a broad base of customers worldwide. The Company's principal
executive offices are located at 670 N. Rosemead Boulevard, Pasadena,
California 91107-2190 and its telephone number is (626) 351-4664.
5
<PAGE>
ACCOUNTING PRONOUNCEMENTS
In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards (SFAS) No. 128, EARNINGS PER
SHARE, which the Company has adopted. The Statement replaces the
presentation of primary Earnings Per Share (EPS) with a presentation of basic
EPS, which excludes dilution and is computed by dividing income available to
common stockholders by the weighted average number of common shares
outstanding for the period. The Statement also requires the dual
presentation of basic and diluted EPS on the face of the income statement for
all entities with complex capital structures and requires a reconciliation of
the numerator and denominator of the basic EPS computation to the numerator
and denominator of the diluted EPS computation. Diluted EPS is computed
similarly to fully diluted EPS pursuant to Accounting Principles Board
Opinion No.15. The following table presents selected consolidated financial
data, including EPS computed in accordance with SFAS No. 128, for the past
five years.
SELECTED CONSOLIDATED FINANCIAL DATA
<TABLE>
<CAPTION>
FISCAL YEARS ENDED
----------------------------------------------------------------------
SEPT. 28,(2) SEPT. 29,(3) OCT. 1,(4) OCT. 2,(5) OCT. 3,
1997 1996 1995 1994 1993
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS DATA
Gross revenue......................................... $246,767 $220,099 $120,034 $96,472 $74,488
Subcontractor costs................................... 55,976 59,062 32,160 28,653 23,323
-------- -------- -------- ------- -------
Net revenue........................................... 190,791 161,037 87,874 67,819 51,165
Cost of net revenue................................... 141,019 122,084 65,484 51,069 38,628
-------- -------- -------- ------- -------
Gross profit.......................................... 49,772 38,953 22,390 16,750 12,537
Selling, general and administrative expenses.......... 25,173 21,218 10,634 7,589 5,696
-------- -------- -------- ------- -------
Income from operations................................ 24,599 17,735 11,756 9,161 6,841
Net interest income (expense)......................... (20) (776) 833 354 290
Income before income taxes............................ 24,579 16,959 12,589 9,515 7,131
Income tax expense.................................... 10,323 6,854 5,036 3,806 2,852
-------- -------- -------- ------- -------
Net income............................................ $14,256 $10,105 $7,553 $5,709 $4,279
-------- -------- -------- ------- -------
-------- -------- -------- ------- -------
Net income per share(1)-basic......................... $0.76 $0.58 $0.46 $0.35 $0.27
----- ----- ----- ----- -----
----- ----- ----- ----- -----
Net income per share(1)-diluted....................... $0.72 $0.56 $0.45 $0.34 $0.26
----- ----- ----- ----- -----
----- ----- ----- ----- -----
Weighted average shares outstanding(1):
Basic................................................ 18,697 17,481 16,468 16,371 16,074
Diluted.............................................. 19,725 18,065 16,917 16,649 16,334
<CAPTION>
SEPT. 28, SEPT. 29, OCT. 1, OCT. 2, OCT. 3,
1997 1996 1995 1994 1993
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
BALANCE SHEET DATA
Working Capital....................................... $42,539 $32,739 $39,872 $24,833 $23,722
Total Assets.......................................... 159,513 88,463 92,930 51,606 38,572
Long-Term Obligations, Excluding
Current Installments................................. -- -- 19,045 -- --
Stockholders' equity.................................. 107,641 63,269 41,496 33,507 26,446
</TABLE>
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(1) Reflects the effect, on a retroactive basis, of a 5-for-4 stock split,
effected in the form of a 25% stock dividend, in December 1997.
(2) Includes the results of operations and financial positions of IWA
Engineers (acquired December 11, 1996), FLO Engineering, Inc.
(acquired December 20, 1996), SCM Consultants, Inc. (acquired March 19,
1997), Whalen & Company, Inc. (acquired June 11, 1997) and Commsite
Development Corporation (acquired July 11, 1997) from the dates set forth
in the related purchase agreements.
(3) Includes the results of operations and financial position of KCM, Inc.
(acquired November 7, 1995) from the date set forth in the related
purchase agreement.
(4) Includes the results of operations and financial position of Tetra Tech EM
Inc., formerly known as PRC Environmental Management, Inc. (acquired
September 15, 1995.) from the date set forth in the related purchase
agreement.
(5) Includes the results of operations and financial positions of Simons, Li &
Associates, Inc. (acquired October 4, 1993) and Hydro-Search, Inc.
(acquired June 3, 1994) from the dates set forth in the related purchase
agreements.
6
<PAGE>
USE OF PROCEEDS
All of the shares of Common Stock covered hereby are being offered by
the Selling Stockholders. The Company will not receive any proceeds from the
sales of Common Stock by the Selling Stockholders.
PRINCIPAL AND SELLING STOCKHOLDERS
On March 26, 1998, Tetra Tech completed the acquisition of C.D.C.
Engineering, Inc., a California corporation ("CDC"), pursuant to the terms of
an Agreement and Plan and Reorganization (the "CDC Agreement") dated March
26, 1998 among Tetra Tech, CDC, CDC Acquisition Corporation, a California
corporation and a wholly-owned subsidiary of Tetra Tech ("CDC Acquisition"),
and the shareholders of CDC. The CDC Agreement provided for the merger of
CDC Acquisition with and into CDC (the "CDC Merger"). As a result of the CDC
Merger, CDC became a wholly-owned subsidiary of Tetra Tech. In connection
with the CDC Merger, subsequent to the purchase price adjustment required by
the CDC Agreement, Tetra Tech (i) issued to the shareholders of CDC an
aggregate of 56,848 shares of Common Stock and (ii) paid to the shareholders
of CDC an aggregate of $332,159 in cash.
The shares of Common Stock to be sold hereunder were issued to the
former shareholders of CDC (collectively, the "Selling Stockholders") in
connection with the CDC Merger.
7
<PAGE>
The following table sets forth information regarding the ownership of
the Company's Common Stock as of July 15, 1998 by (i) all those persons known
by the Company to own beneficially more than 5% of the Company's Common
Stock, (ii) each director and certain executive officers of the Company,
(iii) all executive officers and directors as a group, and (iv) each Selling
Stockholder. Except as otherwise noted, the Company knows of no agreements
among its stockholders which relate to voting or investment power over its
Common Stock.
<TABLE>
<CAPTION>
NUMBER OF NUMBER OF PERCENTAGE OF
SHARES SHARES OF SHARES
BENEFICIALLY COMMON STOCK BENEFICIALLY
NAME OF BENEFICIAL OWNER(1) OWNED OFFERED OWNED(1)
<S> <C> <C> <C>
Li-San Hwang (2)
Tetra Tech, Inc.
670 N. Rosemead Blvd.
Pasadena, California 91107. . . . . 1,338,481 -- 6.0%
Daniel A. Whalen (3)
Whalen & Company, Inc.
3675 Mt. Diablo Blvd.
Suite 360
Lafayette, California 94549. . . . 3,642,920 -- 16.3
Pilgrim Baxter & Associates, Ltd. (4)
Harold J. Baxter
Gary I. Pilgrim
1255 Drummers Lane
Wayne, Pennsylvania 19087. . . . . 2,298,565 -- 10.3
J. Christopher Lewis (5) . . . . . . 63,126 -- *
Patrick C. Haden (6) . . . . . . . . 19,464 -- *
James J. Shelton (7) . . . . . . . . 12,083 -- *
Thomas D. Brisbin (8). . . . . . . . 37,334 -- *
Charles R. Faust (9) . . . . . . . . 35,054 -- *
James M. Jaska (10). . . . . . . . . 42,454 -- *
All directors and executive officers
as a group (12 persons) (11). . . . 5,502,376 -- 24.6
SELLING STOCKHOLDERS
Lorenzo A. Gaglio. . . . . . . . . . 28,424 28,424 *
Robert L. Ozibko . . . . . . . . . . 28,424 28,424 *
</TABLE>
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* Amount represents less than 1% of the Company's Common Stock.
(1) Unless otherwise indicated, the persons named in the table have sole
voting and sole investment power with respect to all shares of Common
Stock shown as beneficially owned by them, subject to community property
rules where applicable and the information contained in this table and
these notes.
(2) Excludes an aggregate of 20,991 shares of Common Stock owned by Dr.
Hwang's adult children as to which Dr. Hwang disclaims beneficial
ownership. Includes 12,792 shares issuable with respect to stock options
exercisable within 60 days after July 15, 1998.
(3) Includes 3,003,307 shares of Common Stock held by Daniel A. Whalen and
Katherine C. Whalen as Trustees for the Whalen Family Trust U/A/D
4/30/92, (ii) 500,000 shares of Common Stock held by Daniel A. Whalen
and Katherine C. Whalen as Trustees for the Whalen 1997 Charitable
Remainder Unitrust, (iii) 22,748 shares of Common Stock held by Daniel
A. Whalen and Katharine C. Whalen as Trustees for the MJW Whalen Trust
1997 - D, (iv) 22,748 shares of Common Stock held by Daniel A. Whalen
and Katharine C. Whalen as Trustees for the ACW Whalen Trust 1997 - D,
(v) 22,748 shares of Common Stock held by Daniel A. Whalen and
Katharine C. Whalen as Trustees for the MCW Whalen Trust 1997 - D, (vi)
22,748 shares of Common Stock held by Daniel A. Whalen and Katharine C.
Whalen as Trustees for the MJW Whalen Trust 1997 - K, (vii) 22,748
shares of Common Stock held by Daniel A. Whalen and Katharine C. Whalen
as Trustees for the ACW Whalen Trust 1997 -K, and (viii) 22,748 shares
of Common Stock held by Daniel A. Whalen and Katharine C. Whalen as
Trustees for the MCW Whalen Trust 1997 - K. All information regarding
share ownership is taken from and furnished in reliance upon the
Schedule 13D (Amendment No. 1), dated as of February 17, 1998, filed by
Daniel A. Whalen. Also includes 3,125 shares issuable with respect to
stock options exercisable within 60 days after July 15, 1998.
8
<PAGE>
(4) All information regarding share ownership is taken from and furnished in
reliance upon the Schedule 13G (Amendment No. 6), dated as of April 9,
1998, jointly filed by Pilgrim Baxter & Associates, Ltd., Harold J. Baxter
and Gary I. Pilgrim.
(5) Includes 12,204 shares issuable with respect to stock options exercisable
within 60 days after July 15, 1998.
(6) Excludes an aggregate of 2,147 shares of Common Stock owned by Mr. Haden's
wife as to which Mr. Haden disclaims beneficial ownership. Includes
12,204 shares issuable with respect to stock options exercisable within
60 days after July 15, 1998.
(7) Includes 2,930 shares held by James J. Shelton, Sarah Belle Shelton and
James J. Shelton, Jr., Trustees of the James J. Shelton and Sarah Belle
Shelton Family Trust dated August 19, 1987, and 9,153 shares issuable
with respect to stock options exercisable within 60 days after July 15,
1998.
(8) Includes 36,719 shares issuable with respect to stock options exercisable
within 60 days after July 15, 1998.
(9) Includes 12,839 shares issuable with respect to stock options exercisable
within 60 days after July 15, 1998. Additionally, Dr. Faust's minor
children own an aggregate of 1,758 shares of Common Stock as to which Dr.
Faust disclaims beneficial ownership.
(10) Includes 41,933 shares issuable with respect to stock options exercisable
within 60 days after July 15, 1998.
(11) Includes 204,049 shares issuable with respect to stock options exercisable
within 60 days after July 15, 1998.
Both Selling Stockholders are employees of CDC, and neither Selling
Stockholder has had any material relationship with the Company, or any of its
predecessors or affiliates. Because the Selling Stockholders may sell all or
part of their shares of Common Stock offered hereby, no estimate can be given
as to the number of shares of Common Stock that will be held by either
Selling Stockholder upon termination of any offering made hereby.
PLAN OF DISTRIBUTION
The Shares are being registered to permit public secondary sales of the
Shares by the Selling Stockholders from time to time until the earlier of (i)
such date as all of the Shares offered by have been sold or (ii) such time as
all of the Shares offered hereby can be sold without compliance with the
registration requirements of the Securities Act pursuant to Rule 144(k)
promulgated thereunder. The Company has agreed, among other things, to bear
all expenses (other than underwriting discounts, selling commissions and fees
and the expenses of counsel and other advisors to the Selling Stockholders)
in connection with the registration and sale of the Shares.
Any distribution hereunder of the Common Stock by the Selling
Stockholders may be effected from time to time in one or more of the
following transactions: (a) through brokers acting as principal or agent, in
transactions (which may involve block transactions), in special offerings, on
the Nasdaq National Market, in the over-the-counter market, or otherwise, at
market prices obtainable at the time of sale, at prices related to such
prevailing market prices, at negotiated prices or at fixed prices, (b) to
underwriters who will acquire shares of Common Stock for their own account
and resell such shares in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices
determined at the time of sale (any public offering price and any discount or
concessions allowed or reallowed or paid to dealers may be changed from time
to time), (c) directly or through brokers or agents in private sales at
negotiated prices, (d) to lenders pledged as collateral to secure loans,
credit or other financing arrangements and any subsequent foreclosure, if
any, thereunder, or (e) by any other legally available means. Also, offers
to purchase the Common Stock may be solicited by agents designated by the
Selling Stockholders from time to time. Underwriters or other agents
participating in an offering made pursuant to this Prospectus (as amended or
supplemented from time to time) may receive underwriting discounts and
commissions under the Securities Act, and discounts or concessions may be
allowed or reallowed or paid to dealers, and brokers or agents participating
in such transactions may receive brokerage or agent's commissions or fees.
In order to comply with the securities laws of certain states, if
applicable, the Common Stock will be sold hereunder in such jurisdictions
only through registered or licensed brokers or dealers. In addition, in
certain states the Common Stock may not be sold hereunder unless the Common
Stock has been registered or qualified for sale in such state or an exemption
from registration or qualification is available and complied with.
The Company has been advised that, as of the date hereof, the Selling
Stockholders have made no arrangement with any broker for the sale of their
shares of Common Stock. The Selling Stockholders and any underwriters,
brokers or dealers involved in the sale of the Common Stock may be considered
"underwriters" as that term is defined by the Securities Act, although the
Selling Stockholders and such brokers and dealers disclaim such status.
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LEGAL MATTERS
The validity of the Common Stock in respect of which this Prospectus is
being delivered will be passed on for the Company by Riordan & McKinzie, a
Professional Corporation, Los Angeles, California.
EXPERTS
The financial statements and the related financial statement schedule
incorporated in this Prospectus by reference from the Company's Annual Report
on Form 10-K for the year ended September 28, 1997 have been audited by
Deloitte & Touche LLP, independent auditors, as stated in their reports,
which are incorporated herein by reference, and have been so incorporated in
reliance upon the reports of such firm given upon their authority as experts
in accounting and auditing.
The financial statements of NUS Environmental for the year ended
December 31, 1997 incorporated in this Prospectus by reference from the
Company's Current Report on Form 8-K/A dated December 31, 1997 have been
audited by Deloitte & Touche LLP, independent auditors, as stated in their
report, which is incorporated herein by reference, and has been so
incorporated in reliance upon the report of such firm given their authority
as experts in accounting and auditing.
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