As filed with the Securities and Exchange Commission on January 14, 2000.
Registration No. 333-________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
EVTC, INC.
(exact name of registrant as specified in its charter)
Delaware 5169 22-3005943
(State or other (Primary Standard Industrial (I.R.S. Employer
jurisdiction of Classification Code Number) Identification No.)
incorporation
or organization)
121 South Norwood Drive
Hurst, Texas 76953
(817) 282-0022
(Address, including zip code, and telephone number, including
area code, of registrant's principal offices)
GEORGE S. CANNAN
Chairman of the Board
DAVID A. KEENER
President and Chief Financial Officer
EVTC, Inc.
121 South Norwood Drive
Hurst, Texas 76053
(817) 282-0022
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copy to:
W. RAYMOND FELTON, ESQ.
Greenbaum, Rowe, Smith, Ravin, Davis & Himmel LLP
Metro Corporate Campus I
Post Office Box 5600
Woodbridge, New Jersey 07095
(732) 549-5600
Approximate date of commencement of proposed sale to the public:
As soon as practicable after this Registration Statement becomes effective.
If the only securities being registered on this Form are being offered pursuant
to dividend or interestreinvestment plans, check the following box. ___
<PAGE>
If any of the securities being registered on this Form are to be offered on
a delay or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. X
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Maximum Maximum
Amount Offering Aggregate Amount of
Title of each Class of to be Price per Offering Registration
Securities to be Registered Registered(1) Share(2) Price(2) Fee
Class A Common Stock, 300,000 $ 5.75 $1,725,000 $ 479.55
par value $.01 per share
- --------------------
1 Includes an indeterminate number of shares of common stock issuable to
prevent dilution resulting from stock splits, stock dividends or similar
transactions pursuant to Rule 416 under the Securities Act of 1933, as amended.
2 Estimated pursuant to Rule 457 based upon the closing price of the common
stock on January 5, 2000 as reported on The Nasdaq Stock Market(TM) solely for
the purpose of computing the registration fee.
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
SUBJECT TO COMPLETION, DATED JANUARY 14, 2000
PROSPECTUS
EVTC, INC.
300,000 SHARES
COMMON STOCK
The Chase Manhattan Bank or an affiliate will sell its shares from time to
time with this prospectus. See "Selling Shareholder" and "Plan of Distribution."
Our common stock is quoted on the Nasdaq Stock Market(TM) under the symbol
"EVTC." On January 5, 2000, the closing price for the common stock was $5.75 as
reported by Nasdaq. An investment in the shares is speculative and only those
purchasers who can afford to lose their entire investment should purchase
shares.
See " Risk Factors" beginning on page 5 for factors to be considered in
connection with purchasing shares.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is a
criminal offense.
The date of this prospectus is January , 2000.
<PAGE>
TABLE OF CONTENTS
Page
----
Prospectus Summary 3
Risk Factors 5
Where You Can Find
More Information 10
Incorporation of Certain
Information by Reference 11
Use of Proceeds 11
Selling Shareholder 12
Plan of Distribution 12
Indemnification 14
Legal Matters 14
Experts 14
You should rely only on the information contained in this prospectus.
No dealer, salesperson or other person is authorized to give any information
that is not contained in this prospectus. This prospectus is not an offer to
sell nor is it seeking an offer to buy these shares in any jurisdiction where
the offer or sale is not permitted. The information contained in this prospectus
is correct only as of the date of this prospectus, regardless of the time of the
delivery of this prospectus or any sale of these shares.
<PAGE>
PROSPECTUS SUMMARY
EVTC, Inc.
The following summary contains basic information about EVTC, Inc. and
its subsidiaries, and this offering. It may not contain all the information that
may be important to you. You should read this entire prospectus, the documents
incorporated by reference, including the financial data and related notes, and
the documents to which we have referred you before making an investment
decision.
EVTC, Inc. currently trades and does business as Environmental
Technologies Corporation. We market and sell refrigerants and refrigerant
reclaiming services. In December 1999, we entered into an agreement to purchase
an internet marketing firm. Prior to July 1998, we also sold recycling and
recovery equipment.
Our automotive line of refrigerants includes R-12, R-22 and R-134a. We
market this line under the label "Arctic Air" to wholesalers and distributors of
automobile supplies for use by mechanics and technicians in servicing automobile
air conditioning systems. We market a complete line of reclaimed and virgin
refrigerants to HVAC/R wholesalers, mechanical contractors and large
institutional and government users of refrigerants. We market R-134a in spray
cans under our customers' private labels for use on dusting moisture-sensitive
equipment, including personal computer screens, cabinets, peripherals and
photographic equipment.
We acquired Refrigerant Reclaim Services, Inc. in February 1994 and
Global Refrigerant Management, Inc. in February 1995. These companies do
business as Full Circle, Inc. Full Circle provides services for the recovery and
reclamation of all refrigerants in response to the requirements of the Clean Air
Act, which strictly regulates the use and disposal of refrigerants containing
certain chemicals. Our recovery services consist of removing used refrigerants
from air conditioning and refrigeration systems and transferring them into
pressurized cylinders for collection. Our reclamation services consist of
"cleaning" refrigerants to remove impurities and contaminants and returning them
to purity standards set by the Air Conditioning and Refrigerant Institute
("ARI"). Reclaimed refrigerants, unlike recycled refrigerants, meet the same
specifications as newly manufactured products. Full Circle markets its services
to large users of refrigerants such as wholesalers of air conditioning and
refrigeration equipment, air conditioning and refrigeration contractors and
owners of air conditioned buildings and refrigeration and cold storage
facilities. Full Circle also purchases used refrigerants for reclamation and
resale. Typically, users choosing to retrofit or replace their CFC bearing
equipment purchase refrigerants from us.
FulCircle Recyclers, Inc. (d/b/a Full Circle) recycles and disposes
fluorescent lighting ballasts of the type commonly found in office, industrial
and institutional buildings. Prior to 1985, ballasts were manufactured using
hazardous compounds, which created a need for special handling and disposal
procedures when replacing ballasts or removing them at the end of their useful
lives. Full Circle recycles and disposes of the hazardous wastes contained in
used ballasts. Full Circle has developed a unique "demanufacturing" process that
efficiently separates the ballast into recyclable products and hazardous waste.
Both PCBs and DEHP are interchangeably demanufactured using the same plant and
processes.
<PAGE>
The disposal process separates the components, recycles all materials
that can be economically recovered and repackages volume reduced hazardous
elements for safe destruction. Over 75% of the weight of a ballast is cooper,
steel and aluminum, which is recovered and sold to scrap metals dealers. Only
the PCB contaminated materials are sent off-site to an incinerator of PCB waste
or to a chemical waste landfill, depending on the customer's preference.
Full Circle has PCB disposal contracts with two major companies, which
collectively control four PCB incinerators. We also have a PCB disposal contract
with two major PCB landfill operators.
In December 1999, we entered into an agreement to acquire
afreegift.com, an internet direct marketing company. The purchase price is
payable in our common stock under an earn out formula and the closing is subject
to approval by our shareholders. (Refer to 8-K filed January 7, 2000)
We were incorporated in Delaware in 1992 under the name "Environmental
Technologies Corporation" and in 1997 we changed our name to "EVTC, Inc." Our
principal executive offices are located at 121 South Norwood Drive, Hurst, Texas
76053, telephone number (817) 282-0022.
<PAGE>
RISK FACTORS
Before you invest in the shares you should be aware that the value of
the shares in the secondary market is subject to various risks, including those
described below. You should consider carefully these risk factors together with
all of the other information included in this prospectus before you decide to
purchase the shares.
We were transferred from the Nasdaq National Market to the Nasdaq SmallCap
Market in 1999 and if we do not continue to meet the listing criteria for the
Nasdaq SmallCap Market, it could adversely affect our stock price.
On May 17, 1999 we received notification from the Nasdaq Listing
Qualifications Panel informing us of the Panel's decision to move trading of our
common stock from the National Market to the Nasdaq Small Cap Market, subject to
successfully completing the required application and review process. The Panel
determined that we had evidenced compliance with the minimum bid price
requirement of $1.00 per share; however, the Panel was of the opinion that we
failed to present a definitive plan which would enable it to evidence compliance
with the $5,000,000 minimum market value of public float requirement for
continued listing on the Nasdaq National Market within a reasonable period of
time. The Panel noted that we appear to comply with all requirements for
continued listing on The Nasdaq Small Cap Market, and expressed confidence in
our ability to sustain compliance with those requirements over the long term,
particularly given our improved results from operations. We successfully
completed the application and review process, demonstrating compliance with all
requirements for inclusion on The Nasdaq SmallCap Market and effective with the
open of business on May 20, 1999, our common stock began trading on to The
Nasdaq SmallCap Market. We are confident of its ability to comply with all
requirements for continued listing on The Nasdaq SmallCap Market; however, if we
were to fail to meet the requirements for continued listing it could have a
materially adverse effect on the price of our common stock
In recent years we have shifted our business emphasis and we are not certain
that the demand is present in the market to sustain our business.
In recent years we have also began marketing R-134a as a replacement
refrigerant for R-12 for new automobile air conditioning systems and as a
compatible replacement for R-22 for dusting moisture-sensitive equipment. During
1999 the Company's suppliers placed the Company under a tight allocation of
R-134a. The shortage of R-134a during the year was a result of several R-134a
plants closing and the strong worldwide demand for the product. The Company
believes that world wide production of R-134a in the future will be sufficient
to fulfill demand and prevent significant future shortages. Following our 1994
acquisition of Refrigerant Reclaim Services, Inc., we began providing
refrigerant reclamation services and marketing reclaimed refrigerants. There can
be no assurance that we will be able to successfully market R-134a as a
replacement for R-12 or R-22 or that more effective replacement refrigerants
will not be introduced which render R-134a less marketable, or that we will be
successful in marketing reclaimed refrigerants or refrigerant reclamation
services.
<PAGE>
The limitations on commercial production and other factors may adversely affect
the supply and price of R-12 resulting in a decline in our operating revenue.
In the mid 1980's, increasing concern about damage to the earth's
stratospheric ozone layer resulted in significant legislation governing
production and use of products containing Chlorofluorocarbons ("CFCs"). CFC
refrigerants primarily used include R-11, R-12, and R-502. In 1987, the United
States became a signatory to the Montreal Protocol on Substances that Deplete
the Ozone Layer (the "Montreal Protocol"), as amended in 1992, which requires
its signatories to reduce and ultimately eliminate production and consumption of
certain ozone depleting substances, including refrigerants. The Montreal
Protocol has been implemented in the United States through the Clean Air Act and
the regulations promulgated thereunder by the Environmental Protection Agency
(EPA). Pursuant to the Clean Air Act, which was amended in 1990 in response to
additional evidence linking the use of CFCs to damage to the earth's ozone
layer, production of CFCs ceased at the end of 1995. The Clean Air Act also
requires the recovery or recycling of all refrigerants used in automobile,
residential and commercial air conditioning and refrigeration systems.
We are 100% dependent on alternative sources of supply of CFC's, such
as reclaimed and recovered R-12. The cost of R-12 has increased dramatically
since the 1990 amendments to the Clean Air Act and we anticipate that the cost
of R-12 will continue to increase as the supply of R-12 continues to decrease.
As part of the Omnibus Budget Reconciliation Act of 1990 (the "Omnibus Act"),
CFC chemicals, including R-12, were subjected to a significant excise tax. The
purchase of R-12 is subject to continual increased levels of taxation under the
provisions of the Omnibus Act, including a tax on R-12 held in our inventory. We
believe, based upon the strong demand for R-12 created by the Clean Air Act's
limitations on production, that the increased cost of R-12 has not adversely
affected sales of R-12 to date. There can be no assurance that in the event that
the cost of R-12 to us increases and the corresponding increased price at which
we must sell R-12 will not adversely affect our ability to market this product
in the foreseeable future. The Company purchases used refrigerant from major
HVAC wholesalers, mechanical contractors, salvage operations, large industrial
and institutional users of refrigerant as well as brokers. The Company uses a
network of wholesale HVAC supply stores that serve as collection stations for
used refrigerants. There can be no assurance, however, that sufficient
quantities of R-12 will be available to us on commercially reasonable terms or
at all, or that sales of R-12 at increased price levels will offset anticipated
declining revenues as a result of reduced supply.
Our sales are highly seasonal which often results in fluctuations in our
operating results on a quarterly basis.
Our shipments of our products are heavily concentrated in the winter
and spring (second and third fiscal quarters) which sales in advance of the
seasonal use of automobile air conditioning systems in most regions of the
United States. As of result, the first and fourth fiscal quarters of our
operations have historically reflected inventory build-up and seasonal operating
losses, which has resulted in periodic cash flow difficulties. In the past, we
have borrowed funds from a working capital revolving line of credit from a bank
during such periods. Currently, the cash flow difficulties have been adequately
funded by our credit facility. Our shift in concentration to sales of reclaimed
refrigerants to the HVAC/R market and R-134a to the automotive air conditioning
market indicates that a substantial portion of these customers will place their
orders for refrigerant during the second and third fiscal quarters.
<PAGE>
Unanticipated events, including delays in securing supplies at the time of peak
sales or significant decreases in sales during such periods, could result in
losses which would not easily be reversed before the following year. There can
be no assurance that such factors will not cause significant fluctuations in
operating results or significant operating losses.
The government's regulation of the production and use of refrigerants containing
CFCs is extensive and expensive and we may not be able to fully comply with the
regulations.
Governmental agencies, including the EPA and various state agencies and
county and local authorities acting in conjunction with federal and state
authorities, extensively regulate the production and use of refrigerants
containing CFCs, including R-12 and R-22. Pursuant to the Clean Air Act, which
was amended in 1990 in response to evidence linking the use of CFCs to damage of
the earth's ozone layer, production of CFCs ceased in 1995. In addition, since
January 1, 1994, the Clean Air Act prohibits "non-essential" uses of R-22. The
EPA has deemed the use of R-22 for dusting to be non-essential, which
effectively prevents us from marketing this product.
The Clean Air Act also requires the recycling of all refrigerants used
in residential and commercial air conditioning and refrigeration systems.
Amendments to existing statutes and regulations, and adoption of new statutes
and regulations which affect the marketing and sale of refrigerants including
the marketing of replacement refrigerants such as R-134a, could require us to
continually adapt our methods of operations and/or discontinue the sale of
certain products at costs that would likely be substantial. There can be no
assurance that we will be able, for financial reasons or otherwise, to adapt our
operations to comply with applicable laws or regulations or obtain and maintain
applicable licenses, permits and approvals in the future. Failure to do so could
have a material adverse effect on us.
Notwithstanding the restrictions on the production and use of
refrigerants imposed by the Clean Air Act, we believe that our business
prospects are significantly enhanced by the stringent enforcement of the
comprehensive regulatory framework by the EPA. We believe that government
mandates requiring the recycling and recovery of refrigerants have created
demand for our reclaimed refrigerant products. However, the delay in enforcement
of regulatory requirements governing the recycling and recovery of refrigerants
have negatively affected us and all other participants in the recycling and
recovery equipment market as purchasing decisions by contractors and technicians
have been postponed as a result of the lack of enforcement. Any significant
relaxation of existing regulatory requirements or continued delay in enforcement
of anticipated regulatory requirements governing the recycling and recovery of
refrigerants could have a material adverse effect on us.
Competing products and technologies may make some or all of our products
non-competitive or obsolete.
The markets for our products are highly competitive. We compete with
numerous well-established companies that market refrigerants, many of which
possess substantially greater financial, marketing, personnel and other
resources than we do, which may position such companies to more effectively
compete against us. Virgin refrigerants are typically marketed by companies
which have significantly greater financial, manufacturing, distribution and
other resources than we do, including large advertising budgets, enabling them
<PAGE>
to implement extensive advertising campaigns, both generally and in response to
efforts by additional competitors to enter into new markets. We are aware of
numerous other companies, which have developed or are developing products or
alternative technologies, which are competitive with our products. Other
products or alternative technologies, which are functionally similar to ours,
are currently available from numerous competitors.
There can be no assurance that we will be able to compete successfully,
that competitors will not develop products or technologies that render our
products obsolete or less marketable.
If we become subject to a claim, we may not have adequate insurance coverage.
We may be exposed to potential significant product liability claims by
our customers and users of our products. We do not maintain product liability
insurance in connection with the marketing and sale of our refrigerants, due
primarily to the relatively high cost of such insurance. Over the past ten
years, we have only been subject to one product liability claim, which was
successfully defended. An uninsured successful claim against us could have a
material adverse effect on our business. We generally warrant our products to be
free from defects in materials and workmanship for a specified period, usually
limited to 6 months from the date of shipment. There can be no assurance that
future warranty expenses will not have an adverse effect on our results of
operations.
Our lack of insurance against potential environmental liability and increased
regulations could have an adverse effect on our business.
Our refrigerant operations require the handling, storage and
transportation of R-12, R-22, R-134a and other refrigerants, which are
classified as hazardous substances under certain laws. We do not maintain
environmental impairment insurance and therefore cannot provide any assurance
that we will not incur environmental liability from the use of hazardous
substances. The use of hazardous substances is subject to extensive federal,
state and local law and substantial regulation under these laws by governmental
agencies, including the EPA, the Occupational Safety and Health Administration,
and various state agencies and county and local authorities acting in
conjunction with federal and state authorities. Among other things, these
regulatory bodies impose requirements to control air, soil and water pollution,
to protect against occupational exposure to such chemicals, including health and
safety risks, and to require notification or reporting of the storage, use and
release of certain hazardous chemicals and substances. We believe that we are in
substantial compliance with all material federal, state and local laws and
regulations, which govern our operations, and we have obtained all material
licenses and permits required for the operation of our business. Amendments to
statutes and regulations and/or our expanded level of operations in the future
could require us to continually modify or alter methods of operations at costs
which could be substantial and could subject us to increased regulation. We
cannot provide any assurance that we will be able, for financial or other
reasons, to comply with applicable laws and regulations. Our failure to comply
with applicable laws and regulations could subject us to civil remedies,
including fines and injunctions as well as potential criminal sanctions, which
could have a material adverse effect on us.
Because we depend heavily on a limited number of suppliers and manufacturers,
any delay, decrease or failure in the performance by the suppliers or
manufacturers could prevent us from delivering our product in a timely manner
which would adversely effect our profit margins and overall business.
<PAGE>
We purchase all of our refrigerants for our reclaiming, packaging and
resale operations from third-party suppliers and manufacturers. We believe that
there are numerous available sources of supply for both our reclaimed and virgin
refrigerants. While we attempt to maintain alternative sources for our
refrigerants, our business is subject to the risk of price fluctuations and
periodic delays in delivery of such products. Accordingly, we are substantially
dependent on the ability of such manufacturers and suppliers, among other
things, to meet performance and quality specifications and to conform to
delivery schedules. Failure by our manufacturers and suppliers to comply with
these and other requirements may have a material adverse effect on our business.
Further, we cannot provide any assurance that such manufacturers and suppliers
will dedicate sufficient production capacity to satisfy our requirements for
virgin refrigerants within scheduled delivery times. We generally purchase
refrigerants, refrigerant containers, and raw materials from numerous suppliers
and manufacturers. We do not maintain supply agreements with our suppliers or
manufacturers and purchase refrigerants, refrigerant containers, and raw
materials pursuant to purchase orders in the ordinary course of business.
Failure or delay by suppliers and manufacturers in supplying necessary
refrigerants, refrigerant containers, and raw materials to us could adversely
affect our profit margin and our ability to obtain and deliver products on a
timely and competitive basis which could have a material adverse effect on us.
Because we will most likely not pay dividends, you will only profit from your
investment if our stock price appreciates.
We currently do not expect to declare or pay cash or other dividends in
the foreseeable future. Earnings, if any, are expected to be retained to finance
and invest in our business.
Since our Certificate of Incorporation includes issuing preferred stock by the
Board of Directors, it is unlikely we can be acquired by anyone without the
consent of our Board of Directors even if it is in your interest.
Our Certificate of Incorporation authorizes the issuance of 1,000,000
shares of "blank check" preferred stock with such designation, rights and
preferences as may be determined from time to time by our Board of Directors. No
shares of preferred stock are currently outstanding. The Board of Directors is
empowered, without stockholder approval, to issue preferred stock with dividend,
liquidation, conversion, voting or other rights, which could adversely affect
the voting power or, other rights of the holders of our Common Stock. In the
event of issuance, the preferred stock could be utilized, under certain
circumstances, as a method of discouraging, delaying or preventing a change in
control of the Company. Although we have no present intention to issue any
shares of its preferred stock, we cannot provide any assurance that we will not
do so in the future.
The exercise of warrants and options or the issuance of additional shares could
adversely affect the market price of our stock.
Future sales of common stock by existing stockholders and holders of
options and warrants to purchase shares of common stock may adversely affect
prevailing market prices for the common stock and could impair our ability to
raise capital through the sale of our equity securities. As of the date of this
prospectus, approximately 4,000,000 shares of common stock, plus the 300,000
<PAGE>
shares offered hereby, are freely tradable without restriction or registration
under the Securities Act of 1933, as amended (the "Securities Act").
This prospectus includes forward-looking statements. All statements
other than statements of historical facts included in this prospectus, including
certain statements under the "Prospectus Summary", may constitute
forward-looking statements. We have based these forward-looking statements on
our current expectations and projections about future events. Although we
believe that our assumptions made in connection with the forward-looking
statements are reasonable, we cannot assure you that our assumptions and
expectations will prove to have been correct. Important factors that could cause
our actual results to differ from our expectations are disclosed below. These
risks and uncertainties include those relating to regulatory action, capital
requirements and competing products are described in the following section. We
undertake no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the informational requirements of the Securities
Exchange Act of 1934, and we therefore file reports, proxy statements and other
information with the Securities and Exchange Commission. Such reports, proxy
statements and other information can 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 regional offices of the Commission located at
500 West Madison Street, Chicago, Illinois 60601 and 7 World Trade Center, New
York, New York 10048. Copies of such material can be obtained from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549 at prescribed rates. Our common stock is quoted on Nasdaq, and such
reports, proxy statements and other information can also be inspected at the
offices of Nasdaq Operations, 1735 K Street, N.W., Washington, D.C. Such
material may also be accessed electronically by means of the Securities and
Exchange Commission's home page on the Internet (http://www.sec.gov).
<PAGE>
We have filed with the Commission a registration statement on Form S-3
with respect to the shares being offered hereby. You may obtain copies of the
registration statement from the Commission at the addresses in the previous
paragraph. This prospectus does not contain all of the information set forth in
the registration statement and its exhibits. We refer you to the registration
statement for further information about us and the shares. While we believe this
prospectus provides the material information regarding the contracts and
documents described herein, the statements contained in this prospectus as to
the contents of any contract or any other documents are not necessarily complete
and, in each such instance, you should refer to the copy of such contract or
document filed as an exhibit to the registration statement.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents we filed with the Commission pursuant to the
Exchange Act (File No. 0-20986) are hereby incorporated by reference in this
prospectus, except as otherwise superseded or modified by this prospectus:
Our Annual Report on Form 10-K, as amended, for the fiscal year
ended September 30, 1999,
All documents subsequently filed by EVTC, Inc. pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, prior to the
termination of the offering shall be deemed to be incorporated by
reference into this Prospectus.
Any statement contained in any document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for the purposes of this prospectus to the extent that a statement contained
herein or in any other subsequently filed documents which 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.
We will furnish without charge to each person, including any beneficial
owner to whom this prospectus is delivered, upon his written or oral request, a
copy of any or all of the documents referred to above which have been
incorporated into this prospectus by reference (other than exhibits to such
documents). Requests for such copies should be directed to:
EVTC, INC.
121 South Norwood Drive
Hurst, Texas 76053
Attention: David Keener, President and Chief Financial Officer
(817) 282-0022
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the shares by
the selling shareholder or any affiliate.
<PAGE>
SELLING SHAREHOLDER
The shares are being registered pursuant to registration rights
obligations we have to the selling shareholder. As of the date of this
prospectus, the selling shareholder has beneficial ownership of the shares being
offered because it owns a presently exercisable warrant to purchase such shares.
The warrant was obtained as part of a forbearance agreement between the
selling shareholder and us in effect in 1999 concerning our then outstanding
indebtedness to the selling shareholder. In December 1999 we obtained new
financing from another lender and repaid most of such indebtedness. A portion of
our indebtedness to the selling shareholder, that was not repaid, was
restructured as part of the refinancing. The selling shareholder currently
intends to transfer the warrant to a non-banking affiliate prior to exercising
the warrant or selling the shares. Other than the shares offered hereby, the
selling shareholder does not hold more than one (1%) percent of out common stock
nor has any of its principals ever held any position or office with us. All of
the shares are issuable upon the exercise of warrants for $1.40 per share. We
have been advised that the selling shareholder or its affiliate intends to sell
the shares at unspecified times on a delayed or continuous basis depending upon,
among other things, favorable market conditions.
The following table sets forth certain information with respect to the
beneficial ownership of the shares by the selling shareholder.
Beneficial Beneficial
Ownership Number of Ownership
of Shares of Shares of of Shares of
Name of Selling Common Stock Common Stock Common Stock
Shareholder Prior to Offering to be Offered After Offering
- --------------- ----------------- ------------- --------------
The Chase Manhattan
Bank 300,000 300,000 0
PLAN OF DISTRIBUTION
The selling shareholder has advised us that there are presently no
underwriting arrangements with respect to the sale of the shares; however, such
arrangements may exist in the future. The selling shareholder or an affiliate,
or its pledgees, donees, transferees or other successors in interest, may choose
to sell all or a portion of the shares from time to time as market conditions
permit in the over-the-counter market, or otherwise, at prices and terms then
prevailing or at prices related to the then-current market price, or at
negotiated prices.
The shares may also be sold by one or more of the following methods,
without limitation:
- block trades in which a broker or dealer so engaged will attempt to
<PAGE>
sell the shares as agent but may position and resell a portion of the block
as principal to facilitate the transaction;
- purchases by a broker or dealer as principal and resale by such
broker and dealer for its account pursuant to this prospectus;
- ordinary brokerage transactions, which may include long or short
sales, and transactions in which the broker solicits purchases;
- "at the market" to or through market makers and into an existing
market for the shares;
- in other ways not involving market makers or established trading
markets, including direct sales to purchasers or sales effected through
agents;
- through transactions in options, swaps or other derivatives,
including transactions with broker-dealers or other financial institutions
that require the delivery by such broker-dealers or institutions of the
shares, which shares may be resold thereafter pursuant to this prospectus;
or
- any combination of the foregoing, or by any other legally available
means.
In effecting sales, brokers or dealers engaged by the selling
shareholder may arrange for other brokers or dealers to participate. Such broker
or dealers may receive commissions or discounts from the selling shareholder or
its affiliate in amounts to be negotiated. Such brokers and dealers and any
other participating brokers or dealers may be deemed to be "underwriters" within
the meaning of the Securities Act in connection with such sales.
INDEMNIFICATION
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant, we have been advised that in the opinion of 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 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, we 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
express in the Securities Act and will be governed by the final adjudication of
such issue.
LEGAL MATTERS
The legality of the Shares offered by this prospectus has been passed
upon by Greenbaum, Rowe, Smith, Ravin, Davis & Himmel LLP, Woodbridge, New
Jersey.
<PAGE>
EXPERTS
The fiscal 1999 financial statements and schedule incorporated by
reference in this Prospectus have been audited by BDO Seidman, LLP, independent
certified public accountants, to the extent and for the periods set forth in
their report incorporated herein by reference, and are incorporated herein in
reliance upon such report given upon the authority of said firm as experts in
auditing and accounting.
The consolidated financial statements and schedule of EVTC, Inc. as of
September 30, 1998 and for each of the years in the two-year period ended
September 30, 1998, have been incorporated by reference herein and in the
registration statement in reliance upon the report of KPMG LLP, independent
certified public accountants, incorporated by reference herein, and upon the
authority of said firm as experts in accounting and auditing.
<PAGE>
300,000 Shares of Common Stock
EVTC, INC.
PROSPECTUS
JANUARY , 2000
Until February , 2000, all dealers that effect transactions in
these securities, whether or not participating in this offering,
may be required to deliver a prospectus. This is in addition to
the dealers' obligation to deliver a prospectus when acting as
underwriters and with respect to their unsold allotments of
subscriptions.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The registrant estimates expenses in connection with the offering described in
this Registration Statement will be as follows:
Item Amount
Securities and Exchange Commission Registration Fee $ 479.55
Printing and Engraving Expenses
Accountants' Fees and Expenses 2,000.00
Legal Fees and Expenses 2,000.00
NASDAQ Listing Fees -
Placement Agent's Fees and Expenses -
Miscellaneous 520.45
----------
Total $ 5,000.00
==========
Item 15. Indemnification of Directors and Officers.
The description set forth under the caption "Indemnification of
Directors and Officers" in EVTC's Registration Statement on Form S-1, filed
October 20, 1992, No. 33-53496, is incorporated herein by reference.
Item 16. Exhibits.
Exhibit
Numbers Description of Documents
3.1 Amended and Restated Certificate of Incorporation(1)
3.2 By-laws of the Registrant(1)
10.2 1996 Stock Option Plan(2)
21.1 Subsidiaries of the Registrant(3)
23.1 Consent of BDO Seidman, LLP (page II-7)
23.2 Consent of KPMG LLP (page II-8)
24.1 Power of Attorney (page II-4)
<PAGE>
-------------------
(1) Filed as an Exhibit to the EVTC, Inc.'s Registration Statement on Form
S-1 (File No. 33-53496) and incorporated herein by reference.
(2) Filed as an Exhibit to EVTC, Inc.'s Proxy Statement dated June 27, 1996
and incorporated herein by reference.
(3) Filed as an Exhibit to EVTC, Inc.'s Annual Report on form 10-K for the year
ended September 30, 1999 and incorporated herein by reference.
Item 17. Undertakings.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant, the registrant has been advised that in the opinion the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer 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 express in the Act and
will be governed by the final adjudication of such issue. The undersigned
registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made of
the securities registered hereby, 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;
and
(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; provided,
however, that the undertakings set forth in paragraphs (i) and (ii) above do not
apply if the Registration Statement is on Form S-3 or Form S-8 and the
<PAGE>
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the Securities Act
of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of
the securities being registered which remain unsold at the termination of the
offering.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable ground to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Hurst, Texas on the 14th day of January, 2000.
EVTC, INC.
By: /s/ George Cannan
---------------------------------
GEORGE CANNAN
Chairman of the Board
POWER OF ATTORNEY
KNOW BY ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints George Cannan, Sr. or David A. Keener his true
and lawful attorney-in-fact and agent, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this Registration Statement, and to file the same, with all exhibits thereto
and other documents in connection therewith, with the Securities and Exchange
commission and any other regulatory authority, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every act and thing requisite and necessary to be one in and about the premises,
as full to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorney-in-fact and agent, or his
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated:
Signature Title Date
- --------- ----- ----
/s/ George Cannan
- -----------------------
George Cannan Chairman of the Board January 14, 2000
and Chief Executive Officer
/s/ David A. Keener
- -----------------------
David Keener President and Chief
Financial Officer January 14, 2000
/s/ John Stefiuk
- -----------------------
John Stefiuk Director January 14, 2000
/s/ Robert Casper
- -----------------------
Robert Casper Director January 14, 2000
/s/ John Mazzuto
- -----------------------
John Mazzuto Director January 14, 2000
<PAGE>
Exhibit 5
Greenbaum, Rowe, Smith, Ravin, Davis & Himmel LLP
Metro Corporate Campus One
P.O. Box 5600
Woodbridge, NJ 07095-0988
January 14, 2000
EVTC, Inc.
121 South Norwood Drive
Hurst, Texas 76053
Re: EVTC, Inc.
Gentlemen:
We have acted as counsel to EVTC, Inc., a Delaware Corporation (the
"Company"), in connection with the filing by the Company of a Registration
Statement on Form S-3 (Registration No. 333-__________), covering the
registration of 300,000 shares of common stock, par value $.01 per share
("Common Stock"). We have been asked to issue an opinion as to whether the
Common Stock being registered will, when sold, be legally issued, fully paid,
non-assessable, and binding obligations of the Company.
As counsel to the Company, we have examined the Certificate of
Incorporation and By-Laws, as amended to date, and other corporate records of
the Company and have made such other investigations as we have deemed necessary
in connection with the opinion hereinafter set forth. We have relied, to the
extent we deem such reliance proper, upon certain factual representations of
officers and directors of the Company given in certificates, in answer to our
written inquiries and otherwise, and, although we have not independently
verified all of the facts contained therein, nothing has come to our attention
that would cause us to believe that any of the statements contained therein are
untrue or misleading.
In making the aforesaid examinations, we have assumed the genuineness
of all signatures and the conformity to original documents of all copies
furnished to us. We have assumed that the corporate records of the Company
furnished to us constitute all of the existing corporate records of the Company
and include all corporate proceedings taken by it.
Based solely upon and subject to the foregoing, we are of the opinion
that the shares of Common Stock are duly authorized, issued and full paid and
non-assessable, and the issuance of such shares by the Company is not subject to
any preemptive or similar rights.
We hereby consent to the filing of this opinion as an Exhibit to the
aforesaid Registration Statement and to the reference to our firm under the
caption "Legal Matters" in the Prospectus.
Very truly yours,
Greenbaum, Rowe, Smith,
Ravin, Davis & Himmel LLP
<PAGE>
Exhibit 23.1
INDEPENDENT AUDITOR'S CONSENT
EVTC, Inc.
Hurst, Texas
We hereby consent to incorporation by reference in the Registration Statement on
Form S-3 of EVTC, Inc. of our report, dated December 8, 1999 except for Notes 5
and 13, as to which the date is December 23, 1999, relating to the consolidated
financial statements and schedule of EVTC, Inc. appearing in the Company's
September 30, 1999 Annual Report on Form 10-K. We also consent to the reference
to us under the caption "Experts" in the Registration Statement.
BDO Seidman, LLP
Dallas, Texas
January 14, 2000
<PAGE>
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
EVTC Inc.:
We consent to the incorporation by reference in the Registration Statement on
Form S-3 of EVTC, Inc. of our report dated January 5, 1999, relating to the
consolidated balance sheet of EVTC Inc. as of September 30, 1998 and the related
consolidated statements of operations and comprehensive income (loss),
stockholders' equity, and cash flows for each of the years in the two-year
period ended September 30, 1998, and related financial statement schedule, which
report appears in the September 30, 1999 annual report on Form 10-K of EVTC Inc.
and to the reference to our firm under the heading "Experts" in the Prospectus.
KPMG LLP
Dallas, Texas
January 14, 2000
