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As filed with the Securities and Exchange Commission on May 7, 1997
Registration No. 333-25351
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 1 TO FORM S-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
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RAILAMERICA, INC.
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(Exact Name of Registrant as Specified in its Charter)
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DELAWARE 4011 65-0328006
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification No.)
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301 YAMATO ROAD
SUITE 1190
BOCA RATON, FLORIDA 33431
(561) 994-6015
(Address, Including Zip Code, and Telephone Number, Including Area Code, of
Registrant's Principal Executive Offices)
GARY O. MARINO
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
RAILAMERICA, INC.
301 YAMATO ROAD
SUITE 1190
BOCA RATON, FLORIDA 33431
(561) 994-6015
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code of Agent for Service)
Please send copies of all communications to:
GARY EPSTEIN, ESQ.
GREENBERG, TRAURIG, HOFFMAN, LIPOFF, ROSEN & QUENTEL, P.A.
1221 BRICKELL AVENUE
MIAMI, FLORIDA 33131
(305) 579-0500
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after this registration statement becomes effective.
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 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, please check the following box and list the
Securities Act registration 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. [ ]
The Registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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PROSPECTUS
RAILAMERICA, INC.
3,656,440 SHARES OF COMMON STOCK
This Prospectus relates to an aggregate of 3,656,440 shares (the
"Securities") of Common Stock, par value $.001 per share (the "Common Stock"),
of RailAmerica, Inc., a Delaware corporation (together with its consolidated
subsidiaries, the "Company"), proposed to be sold from time to time by certain
shareholders of the Company (the "Selling Securityholders"). See "Selling
Securityholders." The Company will not receive any proceeds from the sale of
the Securities by the Selling Securityholders.
The Company has registered the Securities under the Securities Act of 1933,
as amended (the "Securities Act"), for sale by the Selling Securityholders. The
Selling Securityholders have advised the Company that they may from time to time
sell all or part of the Securities in one or more transactions (which may
involve block transactions) in the over-the-counter market, on the NASDAQ
National Market (or any exchange on which the Securities may then be listed), in
negotiated transactions, through the writing of options on the Securities
(whether such options are listed on an options exchange or otherwise), or a
combination of such methods of sale, at market prices prevailing at the time of
such sales or at negotiated prices. The Selling Securityholders may effect such
transactions by selling the Securities to or through broker-dealers, and such
broker-dealers may receive compensation in the form of underwriting discounts,
concessions or commissions from the Selling Securityholders and/or purchasers of
the Securities for whom they may act as agent (which compensation may be in
excess of customary commissions). The Selling Securityholders may also pledge
the Securities as collateral for margin accounts or loans and the Securities
could be resold pursuant to the terms of such accounts or loans. In connection
with such sales, the Selling Securityholders and any participating brokers and
dealers may be deemed to be "underwriters" as defined in the Securities Act.
Neither the Company nor the Selling Securityholders can presently estimate the
amount of commissions or discounts, if any, that will be paid by the Selling
Securityholders on account of their sale of the Securities from time to time.
The Company will pay all expenses, estimated to be approximately $25,000, in
connection with this offering, other than underwriting and brokerage
commissions, discounts, fees and counsel fees and expenses incurred by the
Selling Securityholders.
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THE SECURITIES OFFERED HEREBY ARE HIGHLY SPECULATIVE. FOR A
DISCUSSION OF CERTAIN RISKS WHICH SHOULD BE CONSIDERED IN
EVALUATING AN INVESTMENT IN THE SECURITIES,
SEE "RISK FACTORS" ON PAGES 2 TO 6.
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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.
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The date of this Prospectus is May 7, 1997.
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AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information may be inspected and copied at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 and at the Atlanta Regional Office of the Commission at
3475 Lenox Road, N.E., Suite 1000, Atlanta, Georgia 30326-7232. Copies of such
materials may also be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed
rates. Copies of each document may also be obtained through the Commission's
Internet address at http://www.sec.gov. The Common Stock of the Company is
quoted on the NASDAQ National Market System. Reports, proxy statements and
other information concerning the Company may be inspected at the offices of
NASDAQ, 1735 K. Street, N.W., Washington, D.C. 20006.
The Company has filed with the Commission a registration statement under
the Securities Act of 1933, as amended (the "Securities Act"), with respect to
the Securities offered hereby. This Prospectus, which is a part of the
registration statement, does not contain all the information set forth in, or
annexed as exhibits to, such 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 Securities, reference
is made to such registration statement, including the exhibits thereto, copies
of which may be inspected and copied at the aforementioned facilities of the
Commission. Copies of such registration statement, including the exhibits, may
be obtained from the Public Reference Section of the Commission at the
aforementioned address upon payment of the fee prescribed by the Commission.
Copies of each document may also be obtained through the Commission's internet
address at http://www.sec.gov. The summaries contained in this Prospectus of
additional information included in the Registration Statement or any exhibit
thereto are qualified in their entirety by reference to such information or
exhibit.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents which have been filed by the Company with the
Commission pursuant to the Exchange Act or the Securities Act are incorporated
by reference in this Prospectus:
- The Company's Annual Report on Form 10-KSB/A for the year ended
December 31, 1996, filed on May 7, 1997.
- The Company's report on Form 8-K dated January 15, 1997, filed on
January 29, 1997.
- The Company's report on Form 8-K dated February 19, 1997, filed on
March 6, 1997.
- The Company's Definitive Proxy Statement on Schedule 14A as
filed with the Commission on June 28, 1996.
- All other reports filed by the Registrant pursuant to Section
13(a) or 15 (d) of the Exchange Act since the end of fiscal year
1996.
- The discussion of the Registrant's Common Stock in the
section entitled "Description of Capital Stock" contained in the
Registrant's Registration Statement on Form S-2 (File No.
333-22479), first filed with the Securities and Exchange Commission
on February 27, 1997, as amended.
In addition, 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 of this
Prospectus and prior to the termination of the offering of the Securities
offered hereby shall be deemed to be incorporated herein by reference and to be
a part hereof from the date of filing of such documents.
Any information contained herein or in a document incorporated by
reference herein shall be deemed to be modified or replaced for purposes of
this Prospectus to the extent that information contained herein or in any other
subsequently filed document which also is incorporated by reference herein
modifies or replaces such information. Any such information so modified or
replaced shall not be deemed, except as so modified or replaced, to constitute
a part of this Prospectus.
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The Company hereby undertakes to provide without charge to each person,
including any beneficial owner, to whom a copy of this Prospectus is delivered,
upon the written or oral request of any such person, a copy of any and all of
the above documents (not including exhibits to any of such documents unless
such exhibits are specifically incorporated by reference into such documents).
Such requests should be addressed to the Secretary, RailAmerica, Inc., 301
Yamato Road, Suite 1190, Boca Raton, Florida 33431.
RISK FACTORS
Before purchasing any of the Securities offered hereby, a prospective
purchaser should carefully consider the following risk factors, in addition to
the other information in this Prospectus. This Prospectus contains certain
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended (the "Securities Act"), and Section 21E of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") with respect
to the financial condition, results of operations and business of the Company.
These forward-looking statements are subject to certain risks and
uncertainties. Factors that may cause actual results to differ materially from
those contemplated by such forward-looking statements include, among many
others, the following: (1) competitive conditions in the industry in which the
Company operates and (2) general economic conditions that are less favorable
than expected.
The Securities offered hereby involve a high degree of risk. Prospective
investors should carefully consider, among other things, the following factors
before a decision is made to purchase any Common Stock.
DEPENDENCE ON INDUSTRY AND GOVERNMENTAL AGENCY DEMAND FOR TRUCK TRAILERS.
Through its wholly-owned subsidiary, Kalyn/Siebert, Inc. ("Kalyn"), the Company
manufactures a broad range of specialty truck trailers. Kalyn's operations are
dependent on the demand for its products. Unit sales of new truck trailers
have historically been subject to substantial cyclical variation. In addition,
periods of economic recession in the United States have historically caused
declines in the profitability of the trucking industry, have had a materially
adverse effect on industry-wide demand for new truck trailers and may have a
materially adverse effect on Kalyn's results of operations. Future economic
downturns or cyclical decreases in demand for truck trailers would likely have
a material adverse effect on Kalyn and the Company. In the year ended December
31, 1996, sales to commercial accounts and governmental agencies represented
80% and 20%, respectively, of Kalyn's sales. The majority of Kalyn's sales to
governmental agencies are to the General Services Administration (the "GSA"),
the purchasing arm of non-military agencies, and to the U.S. Army Tank
Automotive Command ("TACOM"), a department of defense unit established to
consolidate purchases for various branches of the military. Accordingly, Kalyn
believes the loss of GSA's and/or TACOM's business could have a material
adverse effect on Kalyn and the Company.
DEPENDENCE ON ONE TRUCK TRAILER MANUFACTURING SITE; DEPENDENCE ON KALYN
REVENUES. Kalyn operates one manufacturing facility which, as of the date of
this Prospectus, was operating at approximately 70% of capacity. Sustained
growth of Kalyn's production and, in turn, its net sales are dependent on its
ability to increase production at its plant on a cost-efficient basis. In
1996, sales attributable to Kalyn accounted for 53% of the Company's total
revenues from continuing operations. Although management anticipates that
Kalyn's revenues will account for a smaller percentage of revenues in the year
ending December 31, 1997, because of the expansion of the Company's railroad
operations, such revenues will continue to be material to the Company. Any
long-term interruption in the operation of Kalyn's plant, from labor strikes, a
natural disaster or other cause, whether or not covered by insurance, could
have a material adverse effect on the Company.
DEPENDENCE ON SUPPLIERS. Kalyn's ability to manufacture truck trailers is
dependent upon receiving supplies, or components and raw materials from a
limited number of sources. To date, Kalyn has experienced no material
difficulties in procuring supplies, components or materials. However, if
deliveries of such items are delayed, Kalyn's production ability may be
decreased, which could have a negative effect on Kalyn's and the Company's
results of operations.
RAILROAD OPERATIONS - DEPENDENCE ON AGRICULTURAL INDUSTRY. Through its
wholly-owned subsidiaries, the Company operates thirteen short line railroads
in the States of Delaware, Michigan, Minnesota, Pennsylvania, Tennessee,
Washington, Indiana and Texas. The Company's haulage in Michigan includes
agricultural commodities, automotive parts, chemicals and fertilizer, ballast
and other stone products. Its haulage in Tennessee includes wood chips, paper,
chemicals and processed foods. Haulage handled in Pennsylvania and Delaware
includes iron and steel products, chemicals, agricultural products, lumber and
processed foods. The Company's haulage in Minnesota includes agricultural
products, aggregates, coal, plastics, lumber, denatured alcohol, scrap iron and
steel. The Company's haulage in Texas consists of cotton, sodium sulfate,
chemicals, fertilizer, scrap iron
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and steel. The Company's haulage in Indiana consists of agricultural
commodities and plastics. The Company's haulage in Washington consists of
woodchips, lumber, minerals, cement and agricultural products. A substantial
portion of the Company's haulage has consisted of agricultural commodities. As a
result, the Company could be materially and adversely affected by factors that
generally affect the agricultural industry in the regions in which it operates.
Such factors include, without limitation, weather and fluctuations in
agricultural prices. Sellers of agricultural commodities typically hold back
shipment of their products until they deem prices to be advantageous. As a
result, the number of carloads handled by the Company and its recognition of
revenue may vary significantly from period to period as a result of fluctuations
in the price for those commodities. Shipments of agricultural commodities, on an
overall basis, occur seasonally, with the majority of the agricultural products
being shipped from September through May. As a result, the Company's revenues
will normally be higher during these months than during the summer. The Company
believes that agricultural commodities will continue to represent the primary
component of the Company's rail haulage for the near future.
RELATIONSHIPS WITH CLASS I RAILROADS. The railroad industry in the United
States is dominated by a small number of large Class I carriers that have
substantial market control and negotiating leverage. Almost all of the traffic
on the Company's railroads is interchanged with Class I carriers. A decision
by any of these Class I carriers to discontinue transporting certain
commodities or to use alternate modes of transportation, such as motor
carriers, could adversely affect the Company's business.
The Company's ability to provide rail service to its customers depends in
large part upon its ability to maintain cooperative relationships with Class I
connecting carriers with respect to, among other matters, freight rates, car
supply, reciprocal switching, interchange and trackage rights. A deterioration
in the operations of or service provided by those connecting carriers, or in
the Company's relationship with its connecting carriers, could adversely affect
the Company's business. In addition, much of the freight transported by the
Company's railroads moves on railcars supplied by Class I carriers. Were these
carriers to reduce the number of railcars available for use by its railroads,
the Company might not be able to obtain replacement railcars on favorable
terms.
ACQUISITION STRATEGY; POTENTIAL NEED FOR ADDITIONAL FINANCING; DILUTION.
The Company's business strategy includes the acquisition of additional railroad
properties or other transportation related businesses. The Company's ability to
implement this strategy is dependent on the availability of financing
alternatives for such acquisitions. There can be no assurance, however, that
such financing will be available or, if available, will be obtainable by the
Company on favorable terms. As of the date of this Prospectus, the Company had
approximately 20,000,000 shares of authorized but unissued Common Stock. The
Company could issue Common Stock in the future to finance future acquisitions on
terms which could be dilutive to the stock ownership of existing stockholders.
Due to the Company's business strategy which places an emphasis on additional
acquisitions of transportation-related companies, it is anticipated that
deferred acquisition costs will continue to accumulate. Termination of
acquisition efforts prior to successful completion will result in write-downs or
write-offs of deferred acquisition costs and corresponding charges against
earnings. Depending on the deferred acquisition costs associated with a
terminated acquisition effort, these charges may be material.
GOVERNMENTAL REGULATION OF RAILROAD OPERATIONS. The Company is subject to
governmental regulation by the Surface Transportation Board ("STB"), the
Federal Railroad Administration and other federal, state and local regulatory
authorities with respect to certain rates and railroad operations, as well as a
variety of health, safety, labor, environmental and other matters, all of which
could potentially affect the competitive position and profitability of the
Company. All railroad industry employees are covered by the Railroad Retirement
Act and the Railroad Unemployment Insurance Act in lieu of Social Security and
other federal and state unemployment insurance programs. Employer
contributions under the Railroad Retirement Act are currently about triple
those required under Social Security. Management of the Company believes that
the regulatory freedoms granted by the Staggers Rail Act have been beneficial
to the Company by giving it flexibility to adjust prices and operations to
respond to market forces and industry changes. However, various interests, and
certain members of the United States House of Representatives and Senate that
have jurisdiction over federal regulation of railroads, have from time to time
expressed their intention to support legislation that would eliminate or reduce
certain significant freedoms granted by the Staggers Rail Act. If enacted,
these proposals, or court or administrative rulings to the same effect under
current law, could have a significant adverse effect on the Company.
DEPENDENCE ON GOVERNMENT GRANTS. The Company has, in the past, attracted
federal and state financial support for rail infrastructure improvements. The
Company believes that it is a critical element of the transportation
infrastructure in many of its territories and that it enjoys strong support
from state and federal authorities. However, there can be no assurance that
such grants will be available in the future or that the Company will continue
to be able to obtain them.
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COMPETITION. The Company's primary source of competition in its rail
operations comes from over-the-road trucks. While the Company must build
or acquire and maintain its rail system, trucks are able to use public roadways.
Any future expenditures materially increasing the roadway system in the
Company's present or proposed areas of operation (or legislation granting
materially greater latitude for trucks with respect to size or weight
limitations) could have a significant adverse effect on the Company's
competitiveness.
The Company faces significant competition in the truck trailer
manufacturing industry, which is highly competitive and has relatively low
barriers to entry. Kalyn competes with a number of other trailer
manufacturers, some of which have greater financial resources and higher sales
than Kalyn. Furthermore, Kalyn's products compete with alternative forms of
shipping, such as intermodal containers. There can be no assurance that Kalyn
will be able to continue to compete effectively with existing or potential
competitors or alternative forms of shipping containers.
DEPENDENCE ON KEY PERSONNEL. The Company's success is dependent on
certain management and personnel, including Gary O. Marino, its Chairman,
President, Treasurer and Chief Executive Officer. The Company's success is
also dependent upon the efforts of Robert B. Coward, the Vice President and
General Manager of Kalyn. The loss of the services of one or more of these
executives could have an adverse effect upon the business of the Company.
While the Company believes that it would be able to locate suitable
replacements for these executives if their services were lost to the Company,
there can be no assurance it would be able to do so. Gary Marino has agreed,
pursuant to an employment agreement, to serve the Company until, at a minimum,
March 1, 1998. Mr. Coward has agreed, pursuant to an employment agreement, to
serve the Company until, at a minimum, August 1997. The Company does not have
"key-person" life insurance on any personnel.
LIABILITY FOR CASUALTY LOSSES. The Company has obtained insurance
coverage for losses arising from personal injury and for property damage in the
event of derailments or other accidents or occurrences. While the Company
believes, based upon its experience, that its insurance coverage is adequate,
under catastrophic circumstances the Company's liability could exceed its
insurance limits. Insurance is available from only a very limited number of
insurers and there can be no assurance that insurance protection at the
Company's current levels will continue to be available or, if available, will
be obtainable on terms acceptable to the Company. The occurrence of losses or
other liabilities which are not covered by insurance or which exceed the
Company's insurance limits could materially adversely affect the financial
condition of the Company.
ENVIRONMENTAL MATTERS. The Company's railroad operations and real estate
ownership are subject to extensive federal, state and local environmental laws
and regulations concerning, among other things, emissions to the air,
discharges to waters, and the handling, storage, transportation and disposal of
waste and other materials. While the Company believes it is in substantial
compliance with all such matters, any allegations or findings to the effect
that the Company had violated laws or regulations could have a materially
adverse effect on the Company.
CERTAIN ANTI-TAKEOVER PROVISIONS. The Company's Amended and Restated
Certificate of Incorporation contains certain anti-takeover provisions that
could have the effect of making it more difficult for a third party to acquire,
or of discouraging a third party from attempting to acquire control of the
Company without negotiating with its Board of Directors. Such provisions
could limit the price that certain investors might be willing to pay in the
future for the Company's securities. Certain of such provisions provide for a
classified Board of Directors with staggered terms, and allow the Company to
issue preferred stock with rights senior to those of the common stock or impose
various procedural and other requirements which could make it more difficult
for stockholders to effect certain corporate actions.
DIVIDEND POLICY. The Company has never declared or paid a dividend on its
Common Stock, and management of the Company expects that a substantial portion
of the Company's future earnings will be retained for expansion or development
of the Company's business, which may include additional acquisitions. Whether
the Company will pay dividends in the future will be at the discretion of the
Company's Board of Directors and will depend upon, among other things, future
earnings, operations, capital requirements and surplus, the general financial
condition of the Company, restrictive covenants in loan or other agreements to
which the Company may be subject, and such other factors as the Board of
Directors may deem to be relevant, including the desirability of cash dividends
to stockholders.
PROBLEMS INHERENT IN GROWTH AND ACQUISITIONS. Since its first
acquisition, the Company has experienced significant growth in revenues,
primarily through the acquisition of transportation services companies that fit
its growth strategy. Since inception, the Company has completed 13
acquisitions. The Company expects to continue its acquisition strategy.
Although the Company believes that additional acquisitions will enhance the
opportunity to increase net earnings, such acquisitions would result in greater
administrative burdens and create the financial risks of additional operating
costs and additional interest costs. Acquisitions also involve a number of
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other risks, including diversion of management's attention to the assimilation
of operations and personnel of the acquired companies, the difficulty of
integrating acquired companies into the Company's management information and
financial reporting systems, possible adverse short-term effects on the
Company's operating results and an adverse impact on earnings from the
amortization of acquired intangible assets. There can be no assurance that the
Company's business will continue to grow in a similar fashion in the future,
that it will be able to find, finance and complete further suitable
acquisitions and integrate effectively any acquisitions made, that such
acquisitions will be profitable or that the Company can effectively adapt its
management, administrative and operational systems to respond to any future
growth.
DEPENDENCE ON CHILEAN ECONOMY. As a result of the Company's acquisition
of a majority interest in the stock of Empressa de Transporte Ferroviario, S.A.
("Ferronor"), the Company's financial condition and results of operations may
be, to a certain extent, sensitive to and dependent upon economic conditions
prevailing from time to time in Chile. There can be no assurance that the
Chilean economy will grow in the future or that future developments in the
Chilean economy will not impair the Company's ability to proceed with its
strategy or its business, financial condition or results of operations. The
Company's financial condition and results of operations could also be affected
by changes in economic or other policies of the Chilean Government or other
political or economic developments in Chile, as well as regulatory changes or
administrative practices of Chilean authorities, over which the Company has no
control.
IMPACT OF INFLATION ON THE CHILEAN ECONOMY. Chile has experienced high
levels of inflation in the past. High levels of inflation in Chile could
adversely affect the Chilean economy. The rate of inflation as measured by
changes in the official consumer price index ("CPI") of the Instituto Nacional
de Estadisticas (the "Chilean National Institute of Statistics") (which is the
inflation index applicable for the restatement of financial information) in
1991 and 1992 was 18.7% and 12.7%, respectively. Inflation for 1993 and 1994
was 12.2% and 8.9%, respectively. Inflation in the year ended December 31,
1995 was 8.2%. The level of Chilean inflation may affect the Company's
financial condition and results of operations. There can be no assurance that
the performance of the Chilean economy or the operating results of the Company
will not be adversely affected by continuing or increased levels of inflation
or that Chilean inflation will not increase significantly from the current
level.
FOREIGN CURRENCY AND FOREIGN EXCHANGE REGULATION. The Chilean peso has
been subject to large nominal devaluations in the past and may be subject to
significant fluctuations in the future. In the three-year period ended
December 31, 1995, the value of the Chilean peso relative to the US dollar
depreciated approximately 6.5% in nominal terms (without adjusting for
inflation) based on the observed exchange rates on December 31, 1992 and
December 31, 1995, and appreciated 19.5% in real terms (adjusting for
inflation) based on the average of the monthly average of the observed exchange
rates for such period. In the five-year period ended December 31, 1995, the
value of the Chilean peso relative to the US dollar declined approximately
20.7% in nominal terms based on the observed exchange rates on December 31,
1990 and December 31, 1995, and appreciated 31.8% in real terms. Although most
of Ferronor's anticipated revenues from operations in Chile will be in US
dollars, a small percentage of anticipated revenues will be in the form of the
Chilean peso. As a result, the Company will be subject to the risk that the
value of the Chilean peso will decline against the dollar. The Company may
seek to limit its exposure to the risk of currency fluctuations by engaging in
hedging or other transactions, which transactions could expose the Company to
substantial risk of loss. The Company has some experience in managing
international transactions, but has yet to formulate a strategy to protect the
Company against currency fluctuations, or retained a financial officer
experienced in such transactions. There can be no assurance that the Company
will successfully manage its exposure to currency fluctuations or that such
fluctuations will not have a material adverse effect on the Company.
DISCONTINUED OPERATIONS OF STEEL CITY CARRIERS, INC. Since the Company's
acquisition of Steel City Carriers, Inc. ("Steel City") in February 1995, Steel
City's financial performance and development have not met the Company's
expectations. Accordingly, in March 1997, the Company adopted a formal plan to
dispose of Steel City and to refocus the Company's efforts on expanding its
core railroad business. Although the Company believes that discontinuing the
operations of Steel City will enhance its opportunity to increase net earnings,
there can be no assurance that such a discontinuance of operations will not
adversely affect the Company's operating results in the future, or that the
Company will not incur a loss on the disposition of Steel City.
SHARES ELIGIBLE FOR FUTURE SALE. On the date of this Prospectus, the
Company had 8,428,229 shares of Common Stock issued and outstanding and
2,812,161 shares of Common Stock reserved for issuance, including: (1) 51,807
shares of Common Stock reserved for issuance upon exercise of the Class B
Warrants (exercise price $3.50 per share); (2) 444,440 shares of Common Stock
reserved for issuance upon conversion of $1,000,000 in principal amount of
Convertible Subordinated Promissory Notes (conversion price $2.25); (3) 364,961
shares of
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Common Stock reserved for issuance upon conversion of $2,000,000 in
principal amount of Series A Convertible Subordinated Debentures (conversion
price $5.48); (4) 250,000 shares of Common Stock reserved for issuance upon
exercise of options granted under the 1992 Stock Option Plan (exercise price
$3.50); (5) 430,000 shares of Common Stock reserved for issuance upon the
exercise of options granted to officers of the Company (exercise price $3.10 -
$5.00); (6) 206,500 and 4,000 shares of Common Stock reserved for issuance upon
exercise of options granted and yet to be granted, respectively, under the 1995
Stock Incentive Plan (exercise price $3.50 - $3.625); (7) 210,000 and 40,000
shares of Common Stock reserved for issuance upon exercise of options granted
and yet to be granted, respectively, under the 1995 Non-Employee Director Stock
Option Plan (exercise price $3.50 - $4.81); (8) 232,092 shares of Common Stock
reserved for issuance upon exercise of options yet to be granted under the 1995
Employee Stock Purchase Plan; (9) 127,500 shares of Common Stock issuable upon
exercise of a warrant issued to Eric D. Gerst (exercise price $4.09); (10)
50,000 shares of Common Stock reserved for issuance on August 31, 1997 to
certain employees of Kalyn; (11) 29,157 shares of Common Stock reserved for
issuance to certain key employees of Steel City; (12) 292,000 shares of Common
Stock reserved for issuance upon the exercise of warrants issued to First London
Securities pursuant to a private placement agreement entered by the Company
(exercise price $4.60 - $5.75); and (13) 79,704 shares of Common Stock reserved
for issuance upon exercise of underwriter's warrants granted to Keane Securities
(effective exercise price - $3.99). Of the 8,428,229 shares of Common Stock
issued and outstanding, the Company believes that approximately 4,900,000 of the
shares are freely tradable without restriction or further registration under the
Securities Act, except for any shares purchased by an "affiliate" of the Company
(in general, a person who has a control relationship with the Company). The
Company believes the approximately 3,400,000 shares of Common Stock remaining
are "restricted securities", as that term is defined under Rule 144 promulgated
under the Securities Act, and may be resold thereafter in compliance with Rule
144. Of the 3,400,000 "restricted securities," 2,920,000 are the subject of
this Prospectus and such shares will no longer be "restricted securities" upon
the effectiveness of the registration statement accompanying this Prospectus.
In general, under Rule 144, as recently amended, a person (or persons
whose shares are aggregated) including an affiliate, who has beneficially owned
such shares for one year, may sell in the open market within any three-month
period a number of shares that does not exceed the greater of (i) 1% of the
then outstanding shares of the Company's Common Stock or (ii) the average
weekly trading volume in the Common Stock in the over-the-counter market during
the four calendar weeks preceding such sale. Sales under Rule 144 are also
subject to certain limitations on the manner of sale, notice requirements and
availability of current public information about the Company. Pursuant to the
amendment, a person (or persons whose shares are aggregated) who is deemed not
to have been an "affiliate" of the Company at any time during the 90 days
preceding a sale by such person and who has beneficially owned such shares for
at least two years, will be able to sell such shares in the public market under
Rule 144(k) without regard to the volume limitations, manner of sale
provisions, notice requirements or availability of current information referred
to above. Restricted shares properly sold in reliance upon Rule 144 are
thereafter freely tradeable without restrictions or registration under the
Act, unless thereafter held by an "affiliate" of the Company.
The possibility that substantial amounts of Common Stock may be issued
and/or freely resold in the public market may adversely affect prevailing
market prices for the Common Stock and could impair the Company's ability to
raise capital through the sale of its equity securities.
THE COMPANY
The Company is a multimodal transportation company that has experienced
significant growth in recent years. Historically, the Company has acquired,
developed and operated short line railroads formed primarily through the
acquisition of light density rail lines from larger railroads. The Company
currently operates approximately 2,400 miles of rail lines in Delaware,
Indiana, Michigan, Minnesota, Pennsylvania, Tennessee, Texas, Washington and
Chile. In 1994, the Company expanded its operations in the transportation
industry through its acquisition of Kalyn/Siebert, Inc. ("Kalyn"), a
manufacturer of a broad range of specialty and custom truck trailers, located
in Gatesville, Texas.
Since deregulation in 1980, Class I railroads in the United States and
Canada have focused their management and capital resources on their long-haul
core systems while divesting branch lines to smaller and more cost-effective
rail operators that are willing to commit the resources necessary to meet the
needs of the shippers located on these lines. Since 1980, more than 300 short
line and regional railroads operating approximately 26,000 miles of track have
been created. The commitment of Class I carriers to increase efficiency and
profitability and the recent merger activity among long-haul railroads is
expected to lead to additional short line divestitures as overlapping routes
are sold and the merged railroads seek to achieve synergies.
The Company's objectives are to foster growth of its existing subsidiaries
and to create a diversified transportation company by acquiring additional
railroads and, to a lesser extent, other transportation-related companies.
Over the last two and a half years, the Company has completed 13 acquisitions,
including a number of short line railroads, and a specialty truck trailer
manufacturing company. These acquisitions have been successfully integrated
into current operations and serve as a platform for the growth experienced by
the Company.
On February 21, 1997, the Company's wholly owned subsidiary, RailAmerica
de Chile, S.A., acquired a majority interest in the stock of Empressa de
Transporte Ferroviario S.A. ("Ferronor"), a 1,400 mile railroad serving
northern Chile. The Company has joined in the purchase of Ferronor with Andres
Pirazzoli y Cia, Ltda. ("APCO"), a family-owned Chilean transportation and
distribution company. The purchase price paid by RailAmerica/APCO for
substantially all of the stock of Ferronor was approximately $12 million and
was funded 55% by the Company and 45% by APCO. The sale of Ferronor by
Corporacion de Fomento de la Produccion, an agency of the Chilean government,
is a continuation of Chile's privatization process.
Ferronor operates the only north-south railroad in northern Chile,
extending from La Calera near Santiago, where it connects with Chile's southern
railway, Ferrocarril del Pacifico, S.A., to its northern terminus at
6
<PAGE> 9
Iquique, approximately 120 miles south of the Peruvian border. It also
operates several east-west branch lines that link a number of iron, copper and
limestone mines and production processing facilities with several Chilean
Pacific port cities. Ferronor also serves Argentina and Bolivia through
traffic interchanged with the General Belgrano Railroad and the Ferrocarriles
Antofagasta Bolivia.
The Company's principal executive offices are located at 301 Yamato Road,
Suite 1190, Boca Raton, Florida 33431 and its telephone number is (561)
994-6015.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of any of
the Securities being offered by Selling Securityholders hereunder.
Expenses expected to be incurred by the Company in connection with this
offering are estimated to be approximately $25,000.
SELLING SECURITYHOLDERS
Of the 3,656,440 shares of Common Stock offered hereby, (i) 1,250,000 and
1,670,000 shares of Common Stock were acquired by certain investors in
connection with the Company's private placements dated September 30, 1996 and
January 15, 1997, respectively, (ii) 292,000 shares of Common Stock are
issuable to First London Securities Corporation ("First London") upon the
exercise of warrants issued to First London in connection with its role as the
placement agent during the Company's private placements dated September 30,
1996 and January 15, 1997, and (iii) the remaining 444,440 shares of Common
Stock are issuable upon the exercise of conversion rights under certain
convertible subordinated promissory notes, which were issued to certain Selling
Securityholders in connection with the Company's acquisition of Kalyn in August
1994.
Except as noted, none of the Selling Securityholders have been officers,
directors, or employees, or have had a material relationship with the Company.
The following table sets forth certain information with respect to the
amount of Securities beneficially owned by the Selling Securityholders and is
adjusted to reflect the sale of Securities offered hereby. The following table
assumes that each of the Selling Securityholders; (i) exercises all of his or
her warrants or conversion rights; and (ii) sells all of his or her Securities.
<TABLE>
<CAPTION>
OWNERSHIP OF SHARES NUMBER OWNERSHIP OF SHARES
SELLING OF COMMON STOCK OF SECURITIES OF COMMON STOCK
STOCKHOLDER PRIOR TO OFFERING OFFERED HEREBY AFTER OFFERING**
- -------------------------- ---------------------- -------------- ----------------------
SHARES PERCENTAGE SHARES PERCENTAGE
------ ---------- ------ ----------
<S> <C> <C> <C> <C> <C>
The Apogee Fund L.P. 100,000 1.2% 100,000 0 0
Davis S. Barnard 44,444 * 44,444 0 0
James E. and Hong Z. 10,000 * 10,000 0 0
Bass
Bev Partners L.P. 63,000 * 63,000 0 0
H. Boyajian, Jr. 5,000 * 3,000 2,000 *
Jane E. Brokaw 10,000 * 10,000 0 0
Emil A. Budnitz, Jr. 10,000 * 10,000 0 0
A. Baron Cass III IRA 80,000 * 80,000 0 0
Rollover
A. Baron Cass III 38,000 * 13,000 0 0
</TABLE>
7
<PAGE> 10
<TABLE>
<CAPTION>
OWNERSHIP OF SHARES NUMBER OWNERSHIP OF SHARES
SELLING OF COMMON STOCK OF SECURITIES OF COMMON STOCK
STOCKHOLDER PRIOR TO OFFERING OFFERED HEREBY AFTER OFFERING**
- -------------------------- ---------------------- -------------- ----------------------
SHARES PERCENTAGE SHARES PERCENTAGE
------ ---------- ------ ----------
<S> <C> <C> <C> <C> <C>
Trustee for the benefit
of the A. Baron Cass III
Children's Trust
A. Baron & Darlene Cass 7,000 * 7,000 0 0
Family Foundation
Comreve Investments 12,500 * 12,500 0 0
Limited
Robert B. Coward (1) 100,000 1.2% 100,000 0 0
Jeff Lane Coward (2) 17,777 * 17,777 0 0
Mary Jill Coward (3) 17,777 * 17,777 0 0
D.C. Investment Partners 25,000 * 25,000 0 0
Opportunity Fund L.P.
Ann Kathleen Dahlson 5,000 * 5,000 0 0
Lenna H. Dersham DLSJC 2,500 * 2,500 0 0
as Custodian
Richard M. Dersham DLSJC 5,000 * 5,000 0 0
as Custodian
Richard M. Dersham DLSJC 2,500 * 2,500 0 0
as Custodian (SEP IRA)
Thomas J. Donavan, Jr. 35,000 * 15,000 20,000 *
Marybeth Drake 27,000 * 27,000 0 0
EFO Fund Ltd. 225,000 2.7% 225,000 0 0
EGS Associates L.P. 157,000 1.8% 157,000 0 0
Lucia A. Englander 15,000 * 15,000 0 0
First London Securities 292,000 3.5% 292,000 0 0
Corporation(4)
Louis D. Francis 14,000 * 10,000 4,000 *
Estate of Charles T. 20,000 * 20,000 0 0
Gaines
Meg Garland 31,111 * 31,111 0 0
Richard J. and Carol H. 50,000 * 50,000 0 0
Giddings
Stephen R. Gohlke or 4,444 * 4,444 0 0
Lynn B. Gohlke (5)
Gryphon Partners Co. 63,500 * 25,000 38,500 *
Byra Hemingway Estate 5,000 * 5,000 0 0
Trust
Brian King & Mason King 12,500 * 12,500 0 0
Livestock Partnership
John Brian King 277,500 3.3% 12,500 265,000 3.2%
LKCM Investment 375,000 4.5% 375,000 0 0
Partnership
LKCM Small Cap Equity 375,000 4.5% 375,000 0 0
Portfolio
John S. Lemak 37,000 * 37,000 0 0
</TABLE>
8
<PAGE> 11
<TABLE>
<CAPTION>
OWNERSHIP OF SHARES NUMBER OWNERSHIP OF SHARES
SELLING OF COMMON STOCK OF SECURITIES OF COMMON STOCK
STOCKHOLDER PRIOR TO OFFERING OFFERED HEREBY AFTER OFFERING**
- -------------------------- ---------------------- -------------- ----------------------
SHARES PERCENTAGE SHARES PERCENTAGE
------ ---------- ------ ----------
<S> <C> <C> <C> <C> <C>
Lawrence Lipton 11,000 * 6,000 5,000 *
N. Martin Co. 50,000 * 50,000 0 0
Nick Martin 50,000 * 50,000 0 0
Sheri Mathis 5,000 * 5,000 0 0
Ewalt Arnold Menn Jr., 40,000 * 40,000 0 0
IRA Rollover
Ray Nixon, Jr. 15,000 * 15,000 0 0
Susan S. Oelson 25,000 * 25,000 0 0
John W. Peavy III 60,000 * 60,000 0 0
John W. Pierson 10,000 * 10,000 0 0
Brian Price 6,500 * 6,500 0 0
Prime Petroleum, Inc. 100,000 1.2% 100,000 0 0
Profit Sharing Trust
Gary Rado 20,000 * 10,000 0 0
Sherman Robertson (6) 8,000 * 8,000 0 0
Don C. Russell 153,333 1.8% 153,333 0 0
Karen C. Samis 31,000 * 25,000 6,000 *
Raymond A. Schakel or 5,333 * 5,333 0 0
Sally B. Schakel (7)
Charles T. Smith, Jr (8). 17,777 * 17,777 0 0
Lewis A. Smith (9) 232,644 2.8% 44,444 188,200 2.2%
Peter P. & Bonnie B. 15,000 * 10,000 5,000 *
Smith
John L. Strauss 380,000 4.5% 280,000 100,000 1.2%
Robert L. Swisher, Jr. 380,000 4.5% 380,000 0 0
Charles C. Taylor 50,000 * 50,000 0 0
Titan Indemnity Co. 50,000 * 50,000 0 0
Dorothy Winchester 18,000 * 18,000 0 0
Windcrest Fund 20,000 * 20,000 0 0
</TABLE>
- -------------------------
*Indicates less than 1%
**Assumes all of the Securities registered hereby are sold.
(1) Robert B. Coward has served as the Company's Senior Vice President,
Manufacturing Group since July 1996. Mr. Coward has been the General
Manager of Kalyn since the Company acquired Kalyn in August 1994.
(2) Jeff Lane Coward is the son of Robert B. Coward and not an employee of
the Company.
(3) Mary Jill Coward is the daughter of Robert B. Coward and not an employee
of the Company.
(4) First London, a securities broker-dealer specializing in equity trading
and investment banking, served as the exclusive placement agent for the
Company's private placements dated September 30, 1996, and January 15,
1997. Douglas R. Nichols, who is the President and principal shareholder
of First London, has served as a director of the Company since July 1996.
(5) Lynn B. Gohlke is an employee of Kalyn who has provided accounting services
at Kalyn since the Company acquired Kalyn in August 1994.
9
<PAGE> 12
(6) Sherman Robertson has been a marketing and sales representative for Kalyn
since the Company acquired Kalyn in August 1994.
(7) Raymond A. Schakel has been Senior Staff Engineer at Kalyn since the
Company acquired Kalyn in August 1994.
(8) Charles T. Smith has been Vice President of Operations at Kalyn since the
Company acquired Kalyn in August 1994.
(9) Lewis A. Smith has been a marketing and sales representative for Kalyn
since the Company acquired Kalyn in August 1994.
PLAN OF DISTRIBUTION
The Selling Securityholders have advised the Company that they may from
time to time sell all or part of the Securities in one or more transactions
(which may involve block transactions) in the over-the-counter market, on the
NASDAQ National Market (or any exchange on which the Securities may then be
listed), in negotiated transactions, through the writing of options on the
Securities (whether such options are listed on an options exchange or
otherwise), or a combination of such methods of sale, at market prices
prevailing at the time of such sales or at negotiated prices. The Selling
Securityholders may effect such transactions by selling the Securities to or
through broker-dealers, and such broker-dealers may receive compensation in the
form of underwriting discounts, concessions or commissions from the Selling
Securityholders and/or purchasers of the Securities for whom they may act as
agent (which compensation may be in excess of customary commissions). The
Selling Securityholders may also pledge the Securities as collateral for margin
accounts or loans and the Securities could be resold pursuant to the terms of
such accounts or loans. In connection with such sales, the Selling
Securityholders and any participating brokers and dealers may be deemed to be
"underwriters" as defined in the Securities Act. Neither the Company nor the
Selling Securityholders can presently estimate the amount of commissions or
discounts, if any, that will be paid by the Selling Securityholders in
connection with the sale of the Securities from time to time. In addition to
sales under the Registration Statement, Securities may be sold by the Selling
Securityholders through an applicable exemption from registration, including,
without limitation, pursuant to Rule 144 under the Securities Act.
The Company has been advised by the Selling Securityholders that they have
not, as of the date of this Prospectus, entered into any arrangement with a
broker-dealer for the sale of the Securities.
The Company will pay all the expenses, estimated to be approximately
$25,000, in connection with this offering, other than underwriting and
brokerage commissions, discounts, fees and counsel fees and expenses incurred
by the Selling Securityholders.
Under the securities laws of certain states, the Securities may be sold in
such states only through registered or licensed brokers or dealers. In
addition, in certain states the Securities may not be sold unless the
Securities have been registered or qualified for sale in such state or an
exemption from registration or qualification is available and is complied with.
The Company has agreed to indemnify the Selling Securityholders and any
underwriters against certain liabilities, including liabilities under the
Securities Act. The Selling Securityholders have also agreed to indemnify the
Company, its directors, officers, agents and representatives against certain
liabilities, including liabilities under the Securities Act.
The Selling Shareholders and other persons participating in the
distribution of the Securities offered hereby are subject to the applicable
requirements of Rule 10b-6 (as amended by Regulation M) promulgated under the
Exchange Act in connection with the sale of the Securities.
LEGAL MATTERS
The validity of the issuance of the Securities offered hereby has been
passed upon for the Company by Greenberg, Traurig, Hoffman, Lipoff, Rosen &
Quentel, P.A., Miami, Florida.
10
<PAGE> 13
EXPERTS
The financial statements of the Company and its consolidated subsidiaries
as of December 31, 1996 and 1995, and for each of the years in the two-year
period ended December 31, 1996, have been incorporated by reference in this
prospectus and registration statement from the Company's Annual Report on Form
10-KSB/A in reliance upon the report of Coopers & Lybrand L.L.P, independent
certified public accountants, which is incorporated herein by reference, and
upon the authority of said firm as experts in accounting and auditing.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company has authority under Section 145 of the Delaware General
Corporation Law to indemnify its directors and officers to the extent provided
for in such statute. The Company's Certificate of Incorporation provides for
indemnification of the Company's officers and directors to the fullest extent
permitted under the Delaware General Corporation Law.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or controlling persons of the
Company, pursuant to the foregoing provisions or otherwise, the Company has
been advised that, in the opinion of the Securities and Exchange Commission
(the "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 suit or proceeding) is
asserted by such director, officer or controlling person in connection with the
securities being registered hereunder, 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.
11
<PAGE> 14
================================================================================
NO DEALER, SALESPERSON OR ANY OTHER PERSON IS AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN AS CONTAINED IN THIS
PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF AN OFFER TO BUY, BY ANY
PERSON IN ANY JURISDICTION IN WHICH IT IS UNLAWFUL TO MAKE SUCH AN OFFER OR
SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE
HEREOF.
--------------------
TABLE OF CONTENTS
page
----
Available Information 1
Incorporation of Certain Information by Reference 1
Risk Factors 2
The Company 6
Use of Proceeds 7
Selling Securityholders 7
Plan of Distribution 10
Legal Matters 10
Experts 10
Indemnification Of Directors And Officers 11
================================================================================
================================================================================
RAILAMERICA, INC.
--------------------------
PROSPECTUS
--------------------------
May 7, 1997
================================================================================
12
<PAGE> 15
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The estimated expenses, excluding solicitation fees, in connection with
this offering are as follows:
<TABLE>
<CAPTION>
AMOUNT
------
<S> <C>
Registration Fee............ $ 5,050
Legal fees and expenses..... $13,000
Accounting fees and expenses $ 4,000
Miscellaneous............... $ 2,000
Total...................... $24,050
=======
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company has authority under Section 145 of the Delaware General
Corporation Law to indemnify its directors and officers to the extent provided
for in such statute. The Company's Amended and Restated Certificate of
Incorporation provides for indemnification of the Company's officers and
directors to the extent permitted under the Delaware General Corporation Law.
The Registrant's Amended and Restated Certificate of Incorporation limits
the liability of Directors to the maximum extent permitted by Delaware General
Corporation Law. Delaware law provides that the directors of a corporation will
not be personally liable to such corporation or its stockholders for monetary
damages for breach of their fiduciary duties as directors, except for liability
(i) for any breach of their duty of loyalty to the corporation or its
stockholders; (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law; (iii) for unlawful
payments of dividends or unlawful stock repurchases or redemptions as provided
in Section 174 of the Delaware General Corporation Law; or (iv) for any
transaction from which the director derives an improper personal benefit. The
Registrant's Amended and Restated Certificate of Incorporation provides that
the Registrant shall indemnify its Directors and officers to the fullest extent
permitted by Delaware law, except against actions by the Registrant approved by
the Board of Directors, and requires the Registrant to advance expenses to such
Directors and officers to defend any action for which rights of indemnification
are provided in the Certificate of Incorporation, and also permits the Board of
Directors to grant such rights to its employees and agents.
II-1
<PAGE> 16
ITEM 16. EXHIBITS
The following exhibits are included as a part of this Registration
Statement:
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------ ----------------------------------------------------------------------------
<S> <C>
3.1 Amended and Restated Articles of Incorporation of Registrant(1).
3.2 By-laws of Registrant(1).
4.1 Warrant Agreement dated as of September 30, 1996 between the Company and
First London Securities Corporation with Form of Warrant (2)
4.2 Warrant Agreement dated as of January 15, 1997 between the Company and
First London Securities Corporation with Form of Warrant (2)
5.1 Opinion of Greenberg, Traurig, Hoffman, Lipoff, Rosen & Quentel, P.A. (4)
11 Statement regarding Computation of Per Share Earnings (3)
23.1 Consent of Greenberg, Traurig, Hoffman, Lipoff, Rosen & Quentel, P.A.
(contained in exhibit 5.1) (4)
23.2 Consent of Coopers & Lybrand L.L.P. (4)
24.1 Power of Attorney (2)
27 Financial Data Schedule (for SEC use only) (3)
</TABLE>
- -------------------
(1) Incorporated by reference to the same exhibit number filed as part of the
Company's Form 10-QSB for the quarter ended September 30, 1995, filed with
the Securities and Exchange Commission on November 12, 1995.
(2) Previously filed.
(3) Incorporated by reference to the footnotes to the financial statements
and to Exhibit 11 included in the Company's Form 10-KSB/A for the year
ended December 31, 1996, filed with the Securities and Exchange
Commission May 7, 1997.
(4) Filed Herewith.
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 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.
II-2
<PAGE> 17
(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.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable. In the event that a claim of
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
The undersigned registrant hereby undertakes to deliver or cause to be
delivered with the prospectus, to each person to whom the prospectus is sent or
given, the latest annual report, to security holders that is incorporated by
reference in the prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be presented by
Article 3 of Regulation S-X is not set forth in the prospectus, to deliver, or
cause to be delivered to each person to whom the prospectus is sent or given,
the latest quarterly report that is specifically incorporated by reference in
the prospectus to provide such interim financial information.
II-3
<PAGE> 18
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Amendment
No. 1 to the Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Boca Raton, Florida, as of May 7,
1997.
RAILAMERICA, INC.
By: /s/ Gary O. Marino
-------------------------------------
Gary O. Marino
Chairman, Chief Executive Officer,
President and Treasurer
(Duly Authorized Representative)
/s/ Gary O. Marino*
-------------------------------------
John H. Marino, Vice Chairman
and Senior Transportation Officer
/s/ Gary O. Marino*
-------------------------------------
Donald D. Redfearn, Executive Vice
President, Secretary and Director
/s/ Gary O. Marino*
-------------------------------------
Larry Bush, Assistant Vice President
and Controller
(Principal Accounting Officer)
/s/ Gary O. Marino*
-------------------------------------
Richard Rampell, Director
/s/ Gary O. Marino*
-------------------------------------
John M. Sullivan, Director
/s/ Gary O. Marino*
-------------------------------------
Charles Swinburn, Director
/s/ Gary O. Marino*
-------------------------------------
Robert F. Toia, Director
/s/ Gary O. Marino*
-------------------------------------
Douglas R. Nichols, Director
* Pursuant to a Power of Attorney granted to Gary O. Marino by such person.
II-4
<PAGE> 1
EXHIBIT 5.1
<PAGE> 2
OPINION OF GREENBERG, TRAURIG, HOFFMAN, LIPOFF, ROSEN & QUENTEL, P.A.
May 7, 1997
RailAmerica, Inc.
301 Yamato Road, Suite 1190
Boca Raton, Florida 33431
Ladies and Gentlemen:
We have acted as counsel for RailAmerica, Inc., a Delaware corporation (the
"Company"), in connection with the Company's Amendment No. 1 to Registration
Statement on Form S-3 (the "Registration Statement") being filed by the Company
under the Securities Act of 1933, as amended, with respect to 3,656,440 shares
of the Company's common stock, par value $.001 per share (the "Common Stock"),
which may be disposed of from time to time by the selling securityholders (the
"Selling Securityholders") named therein. Of the 3,656,440 shares of Common
Stock offered by the Selling Securityholders, (i) 1,250,000 and 1,670,000 shares
(the "Private Placement Shares") of Common Stock were acquired by certain
Selling Securityholders in connection with the Company's private placements
dated September 30, 1996 and January 15, 1997, respectively, (ii) 292,000 shares
(the "First London Shares") of Common Stock are issuable to First London
Securities Corporation ("First London") upon the exercise of warrants issued to
First London in connection with its role as the placement agent during the
Company's private placements dated September 30, 1996 and January 15, 1997, and
(iii) the remaining 444,440 shares (the "Kalyn Shares") of Common Stock are
issuable upon the exercise conversion rights under certain convertible
subordinated promissory notes dated August 31, 1994 (the "Notes"), which were
issued to certain Selling Securityholders in connection with Company's
acquisition of Kalyn/Siebert, Inc.
In connection with the preparation of the Registration Statement and this
letter, we have examined, considered and relied upon the following documents
(collectively, the "Documents"): the Registration Statement; the Warrant
Agreements between the Company and First London dated September 30, 1996 and
January 15, 1997 (the "Warrants"); the Subscription Agreements between the
Company and each of the Selling Securityholders who were investors in the
Company's private placements dated September 30, 1996, and January 15, 1997;
the Agreement for Purchase and Sale of Shares dated as of June 21, 1994,
between the Company and Kalyn/Siebert, Inc.; the Company's Certificate of
Incorporation (as amended) as filed with the Secretary of State of the State of
Delaware; the Company's bylaws and corporate minute book; a certificate of good
standing of the Company issued on May 7, 1997, by the Secretary of State of
the State of Delaware; and such other documents and matters of law as we have
considered necessary or appropriate for the expression of the opinions
contained herein.
In rendering the opinions set forth below, we have assumed without
investigation the genuineness of all signatures and the authenticity of all
documents submitted to us as originals, the conformity to authentic original
documents of all documents submitted to us as copies, and the veracity of the
Documents. As to questions of fact material to the opinions hereinafter
expressed, we have relied upon the representations and warranties of the
Company made in the Documents.
Based solely upon and subject to the Documents, and subject to the
qualifications set forth below, we are of the opinion that (i) the Private
Placement Shares to be sold by the Selling Shareholders pursuant to the
Registration Statement have been duly authorized and validly issued and are
fully paid and nonassessable, and (ii) when the First London Shares and the
Kalyn Shares have been duly delivered in accordance with the terms of the
Warrants and the Notes, respectively, such securities will be validly issued,
fully paid and nonassessable.
Although we have acted as counsel to the Company in connection with
certain other matters, our engagement is limited to certain matters about which
we have been consulted. Consequently, there may exist matters of a legal
nature involving the Company in connection with which we have not been
consulted and have not represented the Company. This opinion letter is limited
to the matters stated herein and no opinions may be implied or inferred beyond
the matters expressly stated herein. The opinions expressed herein are as of
the date
<PAGE> 3
hereof, and we assume no obligation to update or supplement such
opinions to reflect any facts or circumstances that may hereafter come to our
attention or any changes in law that may hereafter occur.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to us under the caption "Legal
Matters" in the prospectus contained in the Registration Statement. In giving
such consent, we do not admit that we come within the category of persons whose
consent is required by Section 7 of the Securities Act of 1933, as amended, and
the rules and regulations thereunder.
Very truly yours,
GREENBERG, TRAURIG, HOFFMAN, LIPOFF,
ROSEN & QUENTEL, P.A.
By: /s/Gary M. Epstein
----------------------------------
Gary M. Epstein
2
<PAGE> 1
EXHIBIT 23.2
<PAGE> 2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Amendment No. 1 to
Registration Statement on Form S-3 of our report dated March 21, 1997 on our
audits of the consolidated financial statements of RailAmerica, Inc. and
Subsidiaries as of December 31, 1996 and 1995 and for the years then ended,
appearing in the Company's Annual Report on Form 10-KSB/A for the year ended
December 31, 1996. We also consent to the reference to our firm under the
caption "Experts."
/s/ Coopers & Lybrand
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COOPERS & LYBRAND
West Palm Beach, Florida
May 7, 1997
1
