SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 11, 1997
HOSPITALITY WORLDWIDE SERVICES, INC.
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(Exact name of registrant as specified in its charter)
New York 0-23054 11-3096377
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
450 Park Avenue, Suite 2603, New York, New York 10022
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Address of principal executive offices
Registrant's telephone number, including area code: (212) 223-0199
N/A
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(Former name or former address, if changed since last report.)
Exhibit Index on Page 8.
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Item 5. OTHER EVENTS.
On November 11, 1997, the Board of Directors of Hospitality
Worldwide Services, Inc. (the "Company") declared a dividend of one preference
share purchase right (a "Right") for each outstanding share of common stock, par
value $.01 per share (the "Common Shares"), of the Company. The dividend is
payable on December 3, 1997 (the "Record Date") to the stockholders of record on
that date. Each Right entitles the registered holder to purchase from the
Company one one-hundredth of a share of Series A Preference stock, par value
$1.00 per share (the "Preference Shares"), of the Company at a price of $80 per
one one-hundredth of a Preference Share (the "Purchase Price"), subject to
adjustment. The description and terms of the Rights are set forth in a Rights
Agreement (the "Rights Agreement"), dated as of November 24, 1997, between the
Company and Continental Stock Transfer & Trust Company, as Rights Agent (the
"Rights Agent").
Until the earlier to occur of (i) 10 days following a public
announcement that a person or group of affiliated or associated persons (an
"Acquiring Person") has acquired beneficial ownership of 20% or more of the
outstanding Common Shares or (ii) 10 business days (or such later date as may be
determined by action of the Board of Directors prior to such time as any person
or group of affiliated persons becomes an Acquiring Person) following the
commencement of, or announcement of an intention to make, a tender offer or
exchange offer the consummation of which would result in the beneficial
ownership by a person or group of 20% or more of the outstanding Common Shares
(the earlier of such dates being called the "Distribution Date"), the Rights
will be evidenced, with respect to any of the Common Share certificates
outstanding as of the Record Date, by such Common Share certificate with a copy
of the Summary of Rights attached thereto.
The Rights Agreement provides that, until the Distribution
Date (or earlier redemption or expiration of the Rights), the Rights will be
transferred with and only with the Common Shares. Until the Distribution Date
(or earlier redemption or expiration of the Rights), new Common Share
certificates issued after the Record Date upon transfer or new issuance of
Common Shares will contain a notation incorporating the Rights Agreement by
reference. Until the Distribution Date (or earlier redemption or expiration of
the Rights), the surrender for transfer of any certificates for Common Shares
outstanding as of the Record Date, even without such notation or a copy of the
Summary of Rights being attached thereto, will also constitute the transfer of
the Rights associated with the Common Shares represented by such certificate. As
soon as practicable following the Distribution Date, separate certificates
evidencing the Rights (the "Right Certificates") will be mailed to holders of
record of the Common Shares as of the close of business on the Distribution Date
and such separate Right Certificates alone will evidence the Rights.
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<PAGE>
The Rights are not exercisable until the Distribution Date.
The Rights will expire on December 3, 2007 (the "Final Expiration Date"), unless
the Final Expiration Date is extended or unless the Rights are earlier redeemed
or exchanged by the Company, in each case, as described below.
The Purchase Price payable, and the number of Preference
Shares or other securities or property issuable, upon exercise of the Rights are
subject to adjustment from time to time to prevent dilution (i) in the event of
a stock dividend on, or a subdivision, combination or reclassification of, the
Preference Shares, (ii) upon the grant to holders of the Preference Shares of
certain rights or warrants to subscribe for or purchase Preference Shares at a
price, or securities convertible into Preference Shares with a conversion price,
less than the then-current market price of the Preference Shares or (iii) upon
the distribution to holders of the Preference Shares of evidences of
indebtedness or assets (excluding regular periodic cash dividends paid out of
earnings or retained earnings or dividends payable in Preference Shares) or of
subscription rights or warrants (other than those referred to above).
The number of outstanding Rights and the number of one
one-hundredths of a Preference Share issuable upon exercise of each Right are
also subject to adjustment in the event of a stock split of the Common Shares or
a stock dividend on the Common Shares payable in Common Shares or subdivisions,
consolidations or combinations of the Common Shares occurring, in any such case,
prior to the Distribution Date.
Preference Shares purchasable upon exercise of the Rights will
not be redeemable. Each Preference Share will be entitled to a minimum
preferential quarterly dividend payment of $1 per share but will be entitled to
an aggregate dividend of 100 times the dividend declared per Common Share. In
the event of liquidation, the holders of the Preference Shares will be entitled
to a minimum preferential liquidation payment of $100 per share but will be
entitled to an aggregate payment of 100 times the payment made per Common Share.
Each Preference Share will have 100 votes, voting together with the Common
Shares. Finally, in the event of any merger, consolidation or other transaction
in which Common Shares are exchanged, each Preference Share will be entitled to
receive 100 times the amount received per Common Share. These rights are
protected by customary antidilution provisions.
Because of the nature of the Preference Shares' dividend,
liquidation and voting rights, the value of the one one-hundredth interest in a
Preference Share purchasable upon exercise of each Right should approximate the
value of one Common Share.
In the event that the Company is acquired in a merger or other
business combination transaction or 50% or more of its consolidated assets or
earning power are sold after a person or group has become an Acquiring Person,
proper provisions will be made so that each holder of a Right will thereafter
have the right
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<PAGE>
to receive, upon the exercise thereof at the then current exercise price of the
Right, that number of shares of common stock of the acquiring company which at
the time of such transaction will have a market value of two times the exercise
price of the Right. In the event that any person or group of affiliated or
associated persons becomes an Acquiring Person, proper provision shall be made
so that each holder of a Right, other than Rights beneficially owned by the
Acquiring Person (which will thereafter be void), will thereafter have the right
to receive upon exercise that number of Common Shares having a market value of
two times the exercise price of the Right.
At any time after any person or group becomes an Acquiring
Person and prior to the acquisition by such person or group of 50% or more of
the outstanding Common Shares, the Board of Directors of the Company may
exchange the Rights (other than Rights owned by such person or group, which will
have become void), in whole or in part, at an exchange ratio of one Common
Share, or one one-hundredth of a Preference Share (or of a share of a class or
series of the Company's preference stock having equivalent rights, preferences
and privileges), per Right (subject to adjustment).
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an adjustment of at least
1% in such Purchase Price. No fractional Preference Shares will be issued (other
than fractions which are integral multiples of one one-hundredth of a Preference
Share, which may, at the election of the Company, be evidenced by depositary
receipts) and in lieu thereof, an adjustment in cash will be made based on the
market price of the Preference Shares on the last trading day prior to the date
of exercise.
At any time prior to the acquisition by a person or group of
affiliated or associated persons of beneficial ownership of 15% or more of the
outstanding Common Shares, the Board of Directors of the Company may redeem the
Rights in whole, but not in part, at a price of $.01 per Right (the "Redemption
Price"). The redemption of the Rights may be made effective at such time on such
basis with such conditions as the Board of Directors in its sole discretion may
establish. Immediately upon any redemption of the Rights, the right to exercise
the Rights will terminate and the only right of the holders of Rights will be to
receive the Redemption Price.
The terms of the Rights may be amended by the Board of
Directors of the Company without the consent of the holders of the Rights,
including an amendment to lower certain thresholds described above to not less
than the greater of (i) the sum of .001% and the largest percentage of the
outstanding Common Shares then known to the Company to be beneficially owned by
any person or group of affiliated or associated persons and (ii) 10%, except
that from and after such time as any person or group of affiliated or associated
persons becomes an Acquiring Person no such amendment may adversely affect the
interests of the holders of the Rights.
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<PAGE>
Until a Right is exercised, the holder thereof, as such, will
have no rights as a stockholder of the Company, including, without limitation,
the right to vote or to receive dividends.
The Rights have certain anti-takeover effects. The Rights will
cause substantial dilution to a person or group that attempts to acquire the
Company on terms not approved by the Company's Board of Directors, except
pursuant to an offer conditioned on a substantial number of Rights being
acquired. The Rights should not interfere with any merger or other business
combination approved by the Board of Directors since the Rights may be redeemed
by the Company at the Redemption Price prior to the time that a person or group
has acquired beneficial ownership of 15% or more of the Common Shares.
The Rights Agreement, dated as of November 24, 1997, between
the Company and Continental Stock Transfer & Trust Company, as Rights Agent,
specifying the terms of the Rights and including the form of the Certificate of
Designations setting forth the terms of the Preference Shares as an exhibit
thereto is attached to the Company's Form 8-A as an exhibit and is incorporated
herein by reference. The foregoing description of the Rights is qualified in its
entirety by reference to such exhibit.
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<PAGE>
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL
INFORMATION AND EXHIBITS.
(c) EXHIBITS.
4.1 Form of Rights Agreement, dated as of November 24,
1997, between Hospitality Worldwide Services, Inc.
and Continental Stock Transfer & Trust Company
(Incorporated by reference to the Company's
Registration Statement of Form 8-A filed with the
Commission on December 2, 1997).
99.1 Press Release dated November 13, 1997.
99.2 Form of Letter to Stockholders to be mailed with
copies of Summary of Rights to Purchase Preference
Shares (Incorporated by reference to the Company's
Registration Statement of Form 8-A filed with the
Commission on December 2, 1997).
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<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HOSPITALITY WORLDWIDE SERVICES, INC.
Dated: November 24, 1997 By: /S/ Howard Anders
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Name: Howard Anders
Title: Executive Vice
President, Chief
Financial Officer and
Secretary
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<PAGE>
EXHIBIT LIST
4.1 Form of Rights Agreement, dated as of November 24,
1997, between Hospitality Worldwide Services, Inc.
and Continental Stock Transfer & Trust Company
(Incorporated by reference to the Company's
Registration Statement of Form 8-A filed with the
Commission on December 2, 1997)
99.1 Press Release dated November 13, 1997.
99.2 Form of Letter to Stockholders to be mailed with
copies of Summary of Rights to Purchase Preference
Shares (Incorporated by reference to the Company's
Registration Statement of Form 8-A filed with the
Commission on December 2, 1997).
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Company Contact:
NEIL G. BERKMAN
ASSOCIATES [LOGO] Howard G. Anders
1900 AVENUE OF THE STARS Chief Financial Officer
SUITE 2850 HOSPITALITY Hospitality Worldwide
LOS ANGELES, CA 90067 ----------- Services
(310) 277-5162 WORLDWIDE (212) 223-0699
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SERVICES, INC.
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FOR IMMEDIATE RELEASE Thursday, November 13, 1997
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Third Quarter Revenue Doubles
HOSPITALITY WORLDWIDE SERVICES (ASE) NINE MONTH REVENUE TRIPLES
Adopts Shareholder Rights Plan
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NEW YORK, NEW YORK, . . . HOSPITALITY WORLDWIDE SERVICES, INC.
(ASE:HWS) announced today that revenue for the nine months ended September 30,
1997 tripled to $54,240,000 from $17,657,000 for the same period of 1996. Net
income after payment of preferred dividends for this year's first nine months
was $1,316,000, or $0.14 per share on approximately 9,166,000 common shares
outstanding, compared to $1,570,000, or $0.22 per share on approximately
7,065,000 shares outstanding, last year.
For the three months ended September 30, 1997, revenue more than
doubled to $16,532,000 from $8,240,000 for the third quarter of 1996. Net income
after payment of preferred dividends was $644,000, or $0.07 per share on
approximately 9,287,000 shares outstanding. This compares to net income of
$831,000, or $0.12 per share on approximately 7,138,000 shares outstanding, for
the same period a year earlier.
Results for this year's first nine months reflect the acquisition of
The Leonard Parker Company (LPC) on January 9, 1997. LPC generated revenue of
approximately $11,300,000 for the third quarter and approximately $38,000,000
for the period since its acquisition.
President and Chief Executive Officer Robert Berman said, "We continue
to be impressed by the magnitude of the growth opportunities in our core
restoration and purchasing businesses, as well as by the significant increase in
activity surrounding our joint venture with Apollo Realty to acquire, renovate
and reposition hotels and other properties throughout the United States."
Berman continued, "The increase in selling, general and administrative
expenses reflects the development of the infrastructure the Company needs to
fully benefit from these opportunities and to support our anticipated growth."
He said that SG&A expenses are expected to decline as a percentage of revenue in
the future.
450 Park Avenue (more)
Suite 2603
New York, NY
10022-2605
(212) 223-0609
Fax 223-0365
<PAGE>
HOSPITALITY WORLDWIDE SERVICES NINE MONTH REVENUE TRIPLES
November 13, 1997
Page Two
Berman added that third quarter results also reflect additional
investments in the Company's wholly-owned subsidiary, Parker Reorder, for the
continuing development of the Parker FIRST software, a procurement system that
allows hotels to order all products used daily at the property, such as
tableware, linens, guest amenities and the like, through a direct computer line.
"The market for hotel operating equipment and supplies runs to many billions of
dollars, a major growth opportunity for Hospitality Worldwide Services. We
expect Parker FIRST, which currently is being beta-tested by several key
customers, to be fully operational by the first quarter of 1998," he said.
The Company also announced today that its Board of Directors has
adopted a Stockholder Rights Plan and declared a dividend granting to its
stockholders the right to purchase for each Common Share one one-hundredth of a
share of a series of preferred stock that will be established by the Company, at
a price of $80.00 for each one one-hundredth of a Preference Share. The Rights
will be issued on December 5, 1997 or shortly thereafter, to shareholders on
that date. Initially, the Rights are attached to the Company's Common Stock and
are not exercisable. They become detached from the Common Stock and become
immediately exercisable after any person or group becomes the beneficial owner
of 20% or more of the Company's Common Stock or 10 days after any person or
group of persons publicly announces a tender or exchange offer that would result
in that same beneficial ownership level.
The Company said that the Plan is designed to protect stockholders from
various abusive takeover tactics, including attempts to acquire control of the
Company at an inadequate price which would deny stockholders the full value of
their investments. The Plan is designed to assure that any acquisition of the
Company and/or any acquisition of control of the Company would take place under
circumstances in which the Board of Directors can secure the best available
transaction for all of the Company's stockholders. The Plan will encourage a
potential buyer to negotiate appropriately with the Board prior to attempting a
takeover and will have no effect on lawful proxy solicitation activity. Details
of the Plan are included with a letter which will be mailed shortly to all of
the Company's stockholders.
Through its subsidiaries, Hospitality Worldwide Services, Inc. (HWS)
provides interior and exterior renovation and procurement services for the
hospitality industry. HWS is based in New York; its Leonard Parker Purchasing
Division is located in Coral Gables, Florida; and its Hospitality Restoration &
Builders Division is headquartered in Los Angeles.
THE STATEMENTS CONTAINED IN THIS RELEASE WHICH ARE NOT HISTORICAL FACTS MAY BE
DEEMED TO CONTAIN FORWARD-LOOKING STATEMENTS WITH RESPECT TO EVENTS, THE
OCCURRENCE OF WHICH INVOLVE RISKS AND UNCERTAINTIES, INCLUDING, WITHOUT
LIMITATION, DEMAND AND COMPETITION FOR THE COMPANY'S PRODUCTS, AND OTHER RISKS
OR UNCERTAINTIES DETAILED IN THE COMPANY'S SECURITIES AND EXCHANGE COMMISSION
FILINGS.
(tables attached)
#1536
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HOSPITALITY WORLDWIDE SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(in thousands, except per share data)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
Sept. 30, Sept. 30,
1997 1996 1997 1996
--------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Revenues $ 16,532 $ 8,240 $ 54,240 17,657
Cost of revenues 11,876 6,252 42,570 13,242
Selling, general and
administrative expenses 3,348 862 9,608 2,278
-------- -------- -------- --------
15,224 7,114 51,178 15,520
-------- -------- -------- --------
Income from operations 1,308 1,126 3,062 2,137
-------- -------- -------- --------
Other income (expense)
Interest (expense) (164) -- (420) --
Interest income 148 -- 289 --
-------- -------- -------- --------
(16) -- (131) --
Income before provision
for income taxes 1,292 1,126 2,931 2,137
Provision for income taxes 573 303 1,390 575
-------- -------- -------- --------
Income from continuing operations 719 823 1,541 1,562
Discontinued operations:
Income from discontinued operations
less applicable taxes of $2 -- 8 -- 8
-------- -------- -------- --------
Net Income 719 831 1,541 1,570
Preferred dividends 75 -- 225 --
-------- -------- -------- --------
Net income applicable to
common shareholders $ 644 $ 831 $ 1,316 $ 1,570
======== ======== ======== ========
Net income per share $ 0.07 $ 0.12 $ 0.14 $ 0.22
======== ======== ======== ========
Weighted average common and common
equivalent shares outstanding 9,287 7,138 9,166 7,065
======== ======== ======== ========
</TABLE>
SUMMARY BALANCE SHEET
Sept. 30, Dec. 31,
1997 1996
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(unaudited) (audited)
Cash and cash equivalents $30,395 $ 276
Accounts receivable 10,955 3,135
Other current assets 8,284 2,686
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Total current assets 49,634 6,097
Property plant & equipment, net 2,480 143
Goodwill and other assets 19,602 6,510
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Total assets $71,716 $12,750
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Current liabilities $18,342 $ 4,971
Notes payable &
capital lease obligations 142 --
Shareholders' equity 53,232 7,779
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Total liabilities &
shareholders' equity $71,716 $12,750
======= =======
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