As filed with the Securities and Exchange Commission on September 16, 1998
Registration No. 333-50057
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------------
AMENDMENT NO. 2
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------------------
HOSPITALITY WORLDWIDE SERVICES, INC.
- --------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Its Charter)
New York
-------------------------------------------------------------------------------
(State or other jurisdiction of
incorporation or organization)
11-3096379
-------------------------------------------------------------------------------
(IRS Employer
Identification Number)
---------------------------
450 Park Avenue
Suite 2603
New York, New York 10022
(212) 223-0699
-------------------------------------------------------------------------------
(Address, Including Zip Code, and Telephone Number of
Registrant's Principal Executive Offices)
---------------------------
Howard G. Anders, Executive Vice President
Hospitality Worldwide Services, Inc.
450 Park Avenue
Suite 2603
New York, New York 10022
(212) 223-0699
- --------------------------------------------------------------------------------
(Name, Address, Including Zip Code, and Telephone Number
of Agent for Service)
Copy to:
Robert H. Friedman, Esq.
Olshan Grundman Frome & Rosenzweig LLP
505 Park Avenue
New York, New York 10022
---------------------------
<PAGE>
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 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, 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 statement number of the
earlier effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to
Rule 462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. / /
If delivery of the prospectus is expected to be made pursuant
to Rule 434, please check the following box. / /
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>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
PROSPECTUS
SUBJECT TO COMPLETION, DATED SEPTEMBER 16, 1998
514,117 SHARES OF COMMON STOCK
HOSPITALITY WORLDWIDE SERVICES, INC.
This Prospectus relates to the reoffer and resale by certain selling
shareholders (the "Selling Shareholders") of Common Stock, $.01 par value (the
"Common Stock"), of Hospitality Worldwide Services, Inc. (the "Company") issued
by the Company to the Selling Shareholders in connection with the acquisition by
the Company of Bekins Distribution Services Co., Inc. ("BDS"). The Common Stock
is being reoffered and resold for the account of the Selling Shareholders and
the Company will not receive any of the proceeds from the resale of the Common
Stock.
The Selling Shareholders have advised the Company that the resale of
their Common Stock may be effected from time to time in one or more transactions
on the American Stock Exchange (the "AMEX"), in negotiated transactions or
otherwise at market prices prevailing at the time of the sale or at prices
otherwise negotiated. The Selling Shareholders may effect such transactions by
selling the Common Stock to or through broker-dealers who may receive
compensation in the form of discounts, concessions or commissions from the
Selling Shareholders and/or the purchasers of the Common Stock for whom such
broker-dealers may act as agent or to whom they sell as principal, or both
(which compensation as to a particular broker-dealer may be in excess of
customary commissions). Any broker-dealer acquiring the Common Stock from the
Selling Shareholders may sell such securities in its normal market making
activities, through other brokers on a principal or agency basis, in negotiated
transactions, to its customers or through a combination of such methods. See
"Plan of Distribution." The Company will bear all expenses in connection with
the preparation of this Prospectus.
- --------------------------------------------------------------------------------
AN INVESTMENT IN THE SECURITIES OFFERED HEREBY INVOLVES
A HIGH DEGREE OF RISK.
SEE "RISK FACTORS" AT PAGE 4 HEREOF.
- --------------------------------------------------------------------------------
The Common Stock is traded on the AMEX under the symbol "HWS". On
September 14, 1998, the last sale price for the Common Stock on the AMEX was
$4.00.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is , 1998.
<PAGE>
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 and other information with the Securities
and Exchange Commission (the "Commission"). Such reports and other information
can be inspected and copied at the public reference facilities maintained by the
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549;
500 West Madison Street, Suite 1400, Chicago, Illinois 60661; and Seven World
Trade Center, Suite 1300, New York, New York 10048. Copies of such material can
be obtained from the Public Reference Section of the Commission at Judiciary
Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. Such
material may also be accessed electronically by means of the Commission's home
page on the Internet at http://www.sec.gov. The Common Stock is listed on the
AMEX and such reports and other information may also be inspected at the offices
of the AMEX, 86 Trinity Place, New York, New York 10006.
TABLE OF CONTENTS
AVAILABLE INFORMATION..........................................................2
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE................................3
RISK FACTORS...................................................................4
THE COMPANY....................................................................8
USE OF PROCEEDS...............................................................10
SELLING SHAREHOLDERS..........................................................10
PLAN OF DISTRIBUTION..........................................................11
LEGAL MATTERS.................................................................12
EXPERTS .....................................................................12
ADDITIONAL INFORMATION........................................................12
-2-
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-K for the year ended December
31, 1997, as amended on April 29, 1998 and on September 16, 1998, Quarterly
Report on Form 10-Q for the quarterly periods ended March 31, 1998 and June 30,
1998, and Current Report on Form 8-K dated January 9, 1998, as amended on March
24, 1998, April 16, 1998 and on September 16, 1998, which have been filed with
the Commission pursuant to the Exchange Act, are incorporated by reference in
this Prospectus and shall be deemed to be a part hereof. All documents filed by
the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act
after the date of this Prospectus and prior to the termination of this offering
are deemed to be incorporated by reference in this Prospectus and shall be
deemed to be a part hereof from the date of filing of such documents.
The Company's Application for Registration of its Common Stock under
Section 12(b) of the Exchange Act filed on September 17, 1997 is incorporated by
reference in this Prospectus and shall be deemed to be a part hereof.
The Company hereby undertakes to provide without charge to each person
to whom a copy of this Prospectus has been delivered, on the written or oral
request of any such person, a copy of any or all of the documents referred to
above which have been or may be incorporated in this Prospectus by reference,
other than exhibits to such documents. Written requests for such copies should
be directed to Hospitality Worldwide Services, Inc. at 450 Park Avenue, Suite
2603, New York, New York 10022, Attention: Secretary. Oral requests should be
directed to such officer (telephone number (212) 223-0699).
----------------
No dealer, salesman or other person has been authorized to give any
information or to make any representations other than those contained in this
Prospectus in connection with the offer made hereby, and, if given or made, such
information or representations must not be relied upon as having been authorized
by the Company or the Selling Shareholders. This Prospectus does not constitute
an offer to sell, or a solicitation of an offer to buy, the securities offered
hereby to any person in any state or other jurisdiction in which such offer or
solicitation is unlawful. The delivery of this Prospectus at any time does not
imply that information contained herein is correct as of any time subsequent to
its date.
-3-
<PAGE>
RISK FACTORS
THE SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK.
PROSPECTIVE INVESTORS SHOULD CAREFULLY CONSIDER THE FOLLOWING RISK FACTORS IN
ADDITION TO THE OTHER INFORMATION IN THIS PROSPECTUS.
RECENT CHANGE OF BUSINESS FOCUS
The Company's historical results of operations do not reflect combined
operations relating to its current lines of business for a significant period of
time and such results may not be indicative of the Company's future results of
operations. In August 1995, the Company acquired substantially all of the assets
and business and assumed certain liabilities of AGF Interior Services, Inc.,
doing business as Hospitality Restoration and Builders ("AGF"), a company that
provided renovation services to the hospitality industry. In February 1996, the
Company disposed of its lighting business, which prior to the acquisition of the
assets of AGF, was its only operating business. In January 1997, the Company
acquired 100% of the outstanding capital stock of The Leonard Parker Company
("LPC"). In May 1997, the Company entered into a joint venture with Apollo Real
Estate Advisors II, L.P. ("Apollo") and Watermark Investments Limited LLC
("Watermark LLC") to identify, acquire, renovate, refurnish and sell hotel
properties (the "Apollo Joint Venture"). In January 1998, the Company acquired
BDS, a leading provider of transportation, warehousing and installation services
to a variety of customers worldwide. Also in January 1998, the Company reached
an agreement in principle to enter into a master development agreement with
Prime Hospitality Corp. ("Prime") to develop up to 20 hotel properties over a
two-year period. In February 1998, the Company acquired certain assets of
Watermark LLC's real estate advisory business. In March 1998, the Company
entered into a joint venture (the "ING Joint Venture") with ING Realty
Properties to acquire and renovate a hotel in Chicago, Illinois. These
businesses represent a substantial change from the Company's original line of
business of designing, manufacturing and installing energy-efficient lighting
fixtures for the hospitality industry. Management and other key personnel may
not have the depth of expertise required to manage such a substantial change in
business focus. If the Company's efforts are not successful, the Company's
results of operations could be materially adversely affected.
MANAGEMENT OF GROWTH
The Company has recently experienced and is expected to continue to
experience growth in the scope of its operations. The Company has hired, and
will need to continue to hire additional financial, human resources and sales
and marketing personnel. This growth will result in increased responsibilities
for management and may place a strain on the Company's operational, financial
and other resources. There can be no assurance that the Company will be able to
achieve or manage any such growth effectively. Failure to do so could have a
material adverse effect on the Company.
HISTORY OF LOSSES
For the year ended December 31, 1997, the Company had a net loss of
$843,649. While the Company had net income of $1,842,678 for the year ended
December 31, 1996, it also had a net loss of $1,115,969 for the year ended
December 31, 1995. There can be no assurance that the Company's operations will
return to profitability or that any positive cash flow generated by the
Company's operations will be sufficient to meet the Company's future cash and
operational requirements.
COMPETITION
Servicing the hospitality industry is a highly competitive business,
with competition based largely on price and quality of service. In its
renovation business, the Company primarily competes with small, closely-held or
family owned businesses. In its purchasing and reorder businesses, the Company
competes with other independent procurement companies, hotel purchasing
companies and food
-4-
<PAGE>
service distribution companies. With respect to the Company's new proprietary
software product ("Parker FIRST"), the Company expects competition from a number
of hotel management companies, hotel companies, franchise operators and other
entities who are pursuing the development of software systems that attempt to
provide on-line procurement services. With respect to the Company's distribution
services, the Company competes with freight brokerage companies, warehouse
divisions of major transportation companies and moving and storage companies.
Some of the Company's competitors and potential competitors possess
substantially greater financial, personnel, marketing and other resources than
the Company. There can be no assurance that the Company will be able to compete
successfully.
RISK OF JOINT INVESTMENTS
The Apollo Joint Venture may be terminated by either the Company or
Apollo at anytime after May 2002 upon 180 days' prior written notice. Apollo
will have complete discretion over the approval and the terms of each project
presented to the Apollo Joint Venture. Each project will be governed by a
separate operating agreement. Each operating agreement in respect of the
development companies formed to purchase, renovate and sell hotel properties
pursuant to the Apollo Joint Venture will provide that Apollo, as the majority
in interest member, may request that each member provide additional capital for
a specific project. In the event that the Company is unable to meet such capital
request, its interest in such project will be decreased by the amount which
Apollo contributes pursuant to such capital request, as well as an additional
penalty amount. Further, if the Company were to pursue the opportunity to
acquire a hotel during the next five years, it would be required to first
present such opportunity to Apollo.
In addition to Apollo's discretion over projects in which the Apollo
Joint Venture will participate, the operating companies formed in respect of
each project will be controlled by Apollo as the majority member in interest and
Apollo and HWS Real Estate Advisory Group, Inc. ("HWS REAG") as managers. The
risk is present in this joint venture, and in other joint ventures in which the
Company may subsequently determine to participate, that the other joint venture
partners may at any time have economic, business or legal interests or goals
that are inconsistent with those of the joint venture or the Company. Moreover,
if Apollo were unable to meet its economic or other obligations to the venture,
the Company could be required to fulfill those obligations. The operating
agreements will also impose certain limitations on transferability of interests,
including the right of members holding in the aggregate a majority of the
interests of the operating company to force any other member to sell its
interest upon a transfer by such members of their interests. In light of the
substantial limitations on the Company's discretion with respect to the Apollo
Joint Venture, there can be no assurance that it will prove to be a successful
joint venture for the Company.
The ING Joint Venture is the obligor under a loan agreement (the "Loan
Agreement") with Credit Suisse First Boston Mortgage Capital LLC ("Credit
Suisse") pursuant to which the ING Joint Venture borrowed approximately
$38,000,000 for the acquisition and renovation of a hotel property located at
the O'Hare International Airport in Chicago. The Company holds 26.56% of the
equity of the ING Joint Venture. The Company has agreed, with respect to the
Loan Agreement, that it will (i) guaranty commencement and completion of the
renovation of the hotel in accordance with the terms set forth in the Loan
Agreement (the "Guaranty of Completion"), (ii) indemnify Credit Suisse against
losses which Credit Suisse may incur based upon environmental related hazards at
the hotel property (the "Environmental Indemnity") and (iii) assign to Credit
Suisse, as security for the Guaranty of Completion and Environmental Indemnity,
its equity interests in the ING Joint Venture.
RISKS ASSOCIATED WITH DEVELOPMENT OF PARKER FIRST
The growth of the Company's reorder business depends largely on the
successful introduction and subsequent market penetration of Parker FIRST. The
Company completed beta testing of this software in March 1998. There can be no
assurance that the product will be successfully implemented on the Company's
proposed timetable or that, once introduced, Parker FIRST will be commercially
-5-
<PAGE>
successful. Significant flaws in the software or delays in implementation would
have a material adverse effect on the Company. In addition, there can be no
assurance that the Company's competitors will not develop software products that
are substantially equivalent or superior to Parker FIRST.
LIMITED INTELLECTUAL PROPERTY PROTECTION
The Company believes that the proprietary nature of Parker FIRST is
critical to the success of such software. There can be no assurance that the
steps taken by the Company to deter misappropriation of its proprietary
information will be adequate or that the Company will be able to take
appropriate steps to enforce intellectual property rights. Further, the laws of
many foreign countries do not protect the Company's intellectual property rights
to the same extent as the laws of the United States. The failure of the Company
to protect its proprietary information could have a material adverse effect on
the Company.
HOTEL RENOVATION RISKS
The Company provides renovation services to its clients on a fixed
price basis. As a result, the Company is exposed to certain risks, including the
possibility of unforeseen construction costs and delays due to various factors
such as the inability to obtain regulatory approvals, inclement weather, fires,
acts of nature and labor or material shortages. Such unanticipated delays and
expenses, should they materialize, could affect the Company's results of
operations and its reputation and impair its ability to obtain additional
renovation work and could have a material adverse effect on the Company.
REAL ESTATE OWNERSHIP RISKS
Hospitality Development Services Corporation ("HDS") and HWS REAG may,
directly or indirectly, hold interests in real property. Real property
investments are subject to varying degrees of risk. Real estate values are
effected by a number of factors, including changes in the general economic
climate, local conditions (such as an over-supply of space or a reduction in
demand for space), the quality and philosophy of management, competition based
on rental and room rates, attractiveness and location of the properties,
financial condition of buyers and sellers of properties, quality maintenance,
insurance and management services, and changes in operating costs. Real estate
values are also effected by such factors as government regulations (including
those governing usage, improvements, zoning and taxes), interest rate levels,
the availability of financing and potential liability under changing
environmental and other laws.
DEPENDENCE UPON AVAILABILITY OF QUALIFIED LABOR
The Company's ability to provide renovation services successfully to
the hospitality industry depends upon its ability to hire local contractors and
laborers in the areas where it provides such renovation services. The Company is
dependent upon the availability of a local labor force, which is affected by
prevailing wages, weather and local economic conditions and there can be no
assurance that such supply will be adequate to meet the Company's requirements
or that such supply can be obtained at wage levels satisfactory to the Company.
Parker FIRST will require substantial software development and
technical support to complete the development and the deployment of the product
and to support it once it is installed. The Company faces intense competition
for software development and technical support personnel from other entities.
There can be no assurance that the Company will be successful in hiring and
retaining such key personnel.
SUPPLIER RELATIONSHIPS
The Company's purchasing arrangements with suppliers of
hospitality-related products are by purchase order and terminable at will by
either party. There can be no assurance that any of the Company's supplier
relationships will not be
-6-
<PAGE>
terminated in the future. While the Company has been able to obtain products on
a timely basis in the past, the Company is subject to the risk that it will be
unable to purchase sufficient products to meet its clients' requirements. Any
shortages or delays in obtaining these products could have a material adverse
effect on the Company.
RISKS ASSOCIATED WITH INTERNATIONAL OPERATIONS
A portion of the Company's revenues is derived from international sales
and the Company's business strategy involves expanding its international
operations. There are certain risks inherent in conducting business
internationally, such as unexpected changes in regulatory requirements, export
restrictions, tariff and other trade barriers, difficulties in staffing and
managing foreign operations, different employment laws and practices in foreign
countries, longer payment cycles, political instability, exposure to currency
fluctuations, exchange rates, imposition of currency exchange controls,
potentially adverse tax consequences and country-specific product requirements,
any of which could adversely effect the success of the Company's international
operations. There can be no assurance that one or more of these factors will not
have a material adverse effect on the Company's international operations and,
consequently, on the Company.
SHARES ELIGIBLE FOR FUTURE SALE
As of April 9, 1998, the Company had 11,868,022 shares of Common Stock
issued and outstanding. Of these shares, a total of 6,679,251 shares of Common
Stock are freely tradable without restriction or registration under the
Securities Act by persons other than "affiliates" of the Company, as defined in
the Securities Act (who would be required to sell under Rule 144 under the
Securities Act). The remaining 5,188,771 shares of Common Stock outstanding upon
completion of the Offering will be "restricted securities" as that term is
defined by Rule 144 (the "Restricted Shares"). The resale of an aggregate of
514,117 shares of Common Stock is being registered in the Registration Statement
of which this Prospectus forms a part. Under Rule 144, a person who has held
restricted securities for a period of one year may sell a limited number of such
securities into the public market without registration of such securities under
the Securities Act. Rule 144 also permits, under certain circumstances, persons
who are not affiliates of the Company to sell their restricted securities
without quantity limitations once they have satisfied Rule 144's two-year
holding period. Sales made pursuant to Rule 144 by the Company's existing
shareholders may have a depressive effect on the price of the shares of Common
Stock in the public market. Such sales could also adversely affect the Company's
ability to raise capital at that time through the sale of its equity securities.
POSSIBLE ANTI-TAKEOVER EFFECTS OF PREFERRED STOCK; POTENTIAL DILUTION OF COMMON
STOCK OR INTEREST IN PARKER REORDER CORPORATION
The Company's Certificate of Incorporation authorizes the Board of
Directors to issue up to 3,000,000 shares of preferred stock, par value $.01 per
share (the "Preferred Stock"). The Preferred Stock may be issued in one or more
series, the terms of which may be determined at the time of issuance by the
Board of Directors, without further action by shareholders. As of the date of
this Prospectus, 200,000 shares of LPC Preferred are outstanding, which shares
were issued as partial consideration for the acquisition of LPC. Although the
Company currently has no plans for the issuance of additional shares of
Preferred Stock, there can be no assurance that the Company will not do so in
the future. The ability of the Board of Directors to issue Preferred Stock could
have the effect of delaying, deferring or preventing a change of control of the
Company or the removal of existing management and, as a result, could prevent
the shareholders of the Company from being paid a premium over the market value
for their shares of Common Stock. At any time between January 10, 1998 and
January 10, 2000, the holders of the LPC Preferred will have the right to
convert such stock into either (i) 1,000,000 shares of Common Stock (subject to
upward adjustment to a maximum of 4,000,000 shares in the event that the market
price of the Common Stock is below $5.00 at the time of conversion) or (ii) 9.8%
of the capital stock
-7-
<PAGE>
of Parker Reorder Corporation ("Parker Reorder"). If the holders exercise the
option to convert the LPC Preferred into shares of Common Stock, holders of
Common Stock will experience dilution. If the holders exercise the option to
convert the LPC Preferred into 9.8% of the capital stock of Parker Reorder, the
Company's equity ownership in Parker Reorder will be reduced. The holders of LPC
Preferred also have the right, as long as the LPC Preferred is outstanding, to
receive 20% of the cumulative net profits of Parker Reorder, measured from
January 1, 1997.
NO DIVIDENDS
The Company has never paid a dividend on its Common Stock and does not
intend to pay any dividends on its Common Stock in the foreseeable future. In
addition, the Company cannot pay or declare dividends on any capital stock other
than the LPC Preferred, so long as such LPC Preferred is outstanding, unless all
accrued and unpaid dividends on the LPC Preferred for all prior applicable
periods have been declared and paid and the dividends on the LPC Preferred Stock
for the current and applicable period has been declared and set apart for
payment. The Company is not otherwise restricted from declaring and paying
dividends to its shareholders.
THE COMPANY
The Company was formed under the laws of the State of New York in
October 1991. In January 1994, the Company consummated an initial public
offering of its common stock. At such time, the Company's principal line of
business was to design and market decorative, energy efficient lighting fixtures
for the hotel and hospitality industry. The Company's primary marketing tool was
the utilization of Con Edison's Applepower Rebate Program (the "Rebate
Program"), under which Con Edison offered rebates to those who utilized energy
saving devices, such as the Company's lighting fixtures. In 1994, Con Edison
substantially reduced the Rebate Program, making it less advantageous for the
Company to use the Rebate Program as a marketing tool. As a result, the
Company's revenues were substantially reduced. In August 1995, the Company
acquired substantially all of the assets and business and assumed certain
liabilities of AGF, a company that, through its wholly-owned subsidiary,
Hospitality Restoration & Builders, Inc., a New York Corporation ("HRB")
provided renovation services to the hospitality industry. In December 1995, the
Company's Board of Directors, in response to Con Edison's decision to reduce
substantially the Rebate Program, determined to dispose of the Company's
lighting business and concentrate the Company's efforts on renovation services.
In February 1996, the Company, AGF, Tova Schwartz, the Company's former
President and Chief Executive Officer, and certain other parties, entered into a
Divestiture, Settlement and Reorganization Agreement (the "Divestiture
Agreement") pursuant to which, among other things, the Company sold its lighting
business to Tova Schwartz and Ms. Schwartz resigned from her positions as a
director and officer of both the Company and HRB. In October 1996, the Company
changed its name from Light Savers, U.S.A., Inc., to Hospitality Worldwide
Services, Inc, which name better reflect the nature of the Company's business in
view of the significant change in the character and strategic focus resulting
from the acquisition of AGF and disposal of the Company's lighting business.
Until January 1997, the Company's only line of business was providing,
through HRB, a complete package of renovation resources to the hospitality
industry ranging from pre-planning and scope preparation of a project to
performing the renovation requirements and delivering furnished rooms. HRB
offers hospitality maintenance services to hotels and hotel chains throughout
the continental United States. For over 18 years the Company's renovation
division has provided to the hospitality industry renovation and improvements
such as vinyl, paint, wallpaper, carpet, installation of new furniture, light
carpentry, and masonry work. HRB generally provides its renovation services in
an on time, on budget manner, while causing little or no disruption to the
ongoing operation of a hotel. HRB has successfully responded to the hotel
industry's efforts to
-8-
<PAGE>
increase occupancy, room rates and market share through cosmetic upgrades, which
are generally required every four to seven years.
In January 1997, the Company completed the acquisition of LPC and its
subsidiary, Parker Reorder Corporation ("Parker Reorder"). LPC, founded in 1969,
is a leading purchasing company for the hospitality industry which acts as an
agent or principal for the purchase of goods and services for its customers
which include major hotel and management companies worldwide. LPC purchases
furniture, fixtures and equipment, kitchen supplies, linens and uniforms,
guestroom amenities, and other supplies to meet its customers' requirements for
new hotel openings and major renovations. In its role as purchasing agent, LPC
purchases annually approximately $250 million of goods and services for its
customers. Parker Reorder has developed and is marketing a new proprietary
software product, Parker FIRST, which allows clients to reorder operating
supplies and equipment ("OS & E") and other products on-line and will provide
such clients with access to forecasting and product evaluation capabilities.
Parker Reorder offers hotel properties the ability to order, on an as needed
basis, any and all OS & E products used by such properties.
In May 1997, the Company entered into the Apollo Joint Venture in order
to identify, acquire, renovate, refurbish and sell hotel properties. The Company
will perform all of the renovation and procurement services for each of the
properties purchased by the Apollo Joint Venture. In addition, the Company will
receive a five percent equity interest in each of the entities formed to
purchase such properties in exchange for its contribution of five percent of the
total equity required to acquire, renovate and sell such properties. The Apollo
Joint Venture intends to own and operate the properties only for the time
necessary to upgrade and market them for resale. The Apollo Joint Venture has
acquired the Warwick Hotel in Philadelphia, Pennsylvania and has entered into a
letter of intent to acquire the Historic Inn in Richmond, Virginia. The Company
will fully renovate and refurbish these properties pursuant to a contract with
the Apollo Joint Venture operating entity.
In November 1997, the Company formed a wholly-owned subsidiary,
Hospitality Construction Corporation ("HCC"), to manage the renovation projects
under the Apollo Joint Venture and other properties in which the Company may
acquire an ownership interest. HCC is based in Atlanta, Georgia.
On January 6, 1998, the Company reached an agreement in principle to
enter into a master development agreement with Prime to develop 20 hotel
properties over a two-year period under the AmeriSuites brand name. Under the
proposed agreement, the Company will provide the site identification,
development, construction and purchasing services required for each project and
Prime will provide project design and management and franchise services once
each property is complete. The Company and Prime will each have a 50% interest
in the new hotels. In December 1997, the Company formed HDS to manage the Prime
project and any other hotel development projects in the future. HDS is based in
New York, New York.
On January 9, 1998, the Company completed the acquisition of BDS, a
leading provider of transportation, warehousing and installation services to a
variety of customers worldwide. Founded in 1969, BDS is a logistical services
company that serves clients who are opening, renovating or relocating facilities
by assuring that materials, fixtures, furniture and merchandise are moved from
multiple vendor locations to their ultimate destinations in a controlled orderly
sequence so that each item can be installed on schedule. BDS is based in St.
Louis, Missouri.
On February 9, 1998, the Company, through its wholly-owned subsidiary,
HWS REAG purchased the assets of Watermark LLC's real estate advisory business.
Watermark LLC is an international management company that is the general partner
and manages Watertone Holdings LP, a shareholder of the Company.
On March 6, 1998, the Company entered into a joint venture with ING
Realty Partners ("ING Joint Venture"), to acquire the Clarion Quality Hotel in
Chicago,
-9-
<PAGE>
Illinois. HCC will fully renovate and refurbish this property pursuant to a
contract with the ING Joint Venture.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the reoffer and
resale of the Common Stock by the Selling Shareholders.
SELLING SHAREHOLDERS
The following table sets forth (i) the number of shares of Common Stock
beneficially owned by each Selling Shareholder as of April 9, 1998, (ii) the
number of Shares to be offered for resale by each Selling Shareholder and (iii)
the number and percentage of Common Stock to be held by each Selling Shareholder
after completion of the offering.
<TABLE>
<CAPTION>
Number
Shares of
Common
Stock/Per-
Number of centage of
Shares to Class to be
Number of Shares be Owned After
of Common Stock Offered Completion
Owned at April 9, for of the
Name and Address 1998 (1) Resale Offering
- -------------------------------------------- ---------------------------- -------------- -------------------
<S> <C> <C> <C>
Barney A. Ebsworth 181,992 181,992 0
13 Upper Ladue
St. Louis, Missouri 63124
Michael J. Scannell 54,598 54,598 0
99 Meadowbrook CC
Ballwin, Missouri 63011
Wayne L. Smith, II 33,993 33,993 0
1050 Arlington Oaks Terrace
Town & Country, Missouri
63017
Daniel A. Field 27,169 27,169 0
913 Wheatridge Drive
Troy, Illinois 62294
Daniel P. Kelly 29,453 29,453 0
5835 Neosho Street
St. Louis, Missouri 63109
Russell J. Sainz 27,169 27,169 0
222 Timbertree Court
Ballwin, Missouri 63011
Stanley A. Eisen 29,453 29,453 0
908 Mansionhill Drive
Ballwin, Missouri 63011
Christiane Ebsworth 25,999 25,999 0
921 South Hanley Road
St. Louis, Missouri 63105
S. N. Roseberry 25,999 25,999 0
1504 Buttonbush Circle
Palm City, Florida 34990
</TABLE>
-10-
<PAGE>
<TABLE>
<CAPTION>
Number
Shares of
Common
Stock/Per-
Number of centage of
Shares to Class to be
Number of Shares be Owned After
of Common Stock Offered Completion
Owned at April 9, for of the
Name and Address 1998 (1) Resale Offering
- -------------------------------------------- ---------------------------- -------------- -------------------
<S> <C> <C> <C>
Steve C. DeValliere 10,705 10,705 0
6405 O'Bannon
Las Vegas, Nevada 69102
Irving L. Watson 7,065 7,065 0
1965 Flower Circle
Kissimmee, Florida 34744
Robert Hannegan 3,426 3,426 0
7711 Bonhomme
St. Louis, Missouri 63105
National Automobile & Casualty 38,064 38,064 0
Insurance Co.
257 Fair Oaks Avenue
Pasadena, California 91105
Amy Kaspar 1,903 1,903 0
625 Charleston Oaks
Ballwin, Missouri 63201
Matthew Koster 5,710 5,710 0
500 N. Central
St. Louis, Missouri 63130
Mark Reed 5,710 5,710 0
410 Woodlawn Avenue
Webster Groves, Missouri
63119
Mark Sarrett 1,903 1,903 0
1041 E. Amelia Drive
Long Beach, California 90807
Mimi Taylor 1,903 1,903 0
1893 Galbreath Road
Pasadena, California 91104
Tim Young 1,903 1,903 0
79 Patrician, #3F
Pasadena, California 91105
</TABLE>
- --------------------
(1) The persons named in the table, to the Company's knowledge, have sole
voting and investment power with respect to all shares shown as
beneficially owned by them, subject to community property laws where
applicable and the footnotes to this table. The calculation of shares
of Common Stock beneficially owned was determined in accordance with
Rule 13- 3(d) of the Exchange Act.
PLAN OF DISTRIBUTION
This offering is self-underwritten; neither the Company nor the Selling
Shareholders have employed an underwriter for the sale of Common Stock by the
Selling Shareholders. The Company will bear all expenses in connection with the
-11-
<PAGE>
preparation of this Prospectus. The Selling Shareholders will bear all expenses
associated with the sale of the Common Stock.
The Common Stock may be sold from time to time by the Selling
Shareholders, or by pledgees, donees, transferees or other successors in
interest on the AMEX, in negotiated transactions or otherwise, at market prices
prevailing at the time of the sale or at prices otherwise negotiated. The
Selling Shareholders may effect such transactions by selling shares to or
through broker-dealers, and all such broker-dealers may receive compensation in
the form of discounts, concessions, or commissions from the Selling Shareholders
and/or the purchasers of shares of Common Stock for whom such broker-dealers may
act as agents or to whom they sell as principals, or both (which compensation as
to a particular broker-dealer might be in excess of customary commissions).
Any broker-dealer acquiring Common Stock from the Selling Shareholders
may sell the shares either directly, in its normal market-making activities,
through or to other brokers on a principal or agency basis or to its customers.
Any such sales may be at prices then prevailing on the AMEX or at prices related
to such prevailing market prices or at negotiated prices to its customers or a
combination of such methods. The Selling Shareholders and any broker-dealers
that act in connection with the sale of the Common Stock hereunder might be
deemed to be "underwriters" within the meaning of Section 2(11) of the
Securities Act; any commissions received by them and any profit on the resale of
shares as principal might be deemed to be underwriting discounts and commissions
under the Securities Act. Any such commissions, as well as other expenses
incurred by the Selling Shareholders and applicable transfer taxes, are payable
by the Selling Shareholders.
LEGAL MATTERS
Certain legal matters in connection with the issuance of the Shares
offered hereby have been passed upon for the Company by Messrs. Olshan Grundman
Frome & Rosenzweig LLP, 505 Park Avenue, New York, New York 10022.
EXPERTS
The consolidated financial statements of Hospitality Worldwide
Services, Inc. and Subsidiaries appearing in the Company's Annual Report on Form
10-K, as amended, for the year ended December 31, 1997 have been audited by
Arthur Andersen LLP, independent public accountants, as set forth in their
report thereon included therein and incorporated herein by reference. Such
financial statements are, and audited financial statements to be included in
subsequently filed documents will be, incorporated herein in reliance upon the
reports of Arthur Andersen LLP pertaining to such financial statements (to the
extent covered by consents filed with the Securities and Exchange Commission)
given upon the authority of such firm as experts in accounting and auditing. The
consolidated financial statements of Hospitality Worldwide Services, Inc. and
Subsidiary appearing in the Company's Annual Report on Form 10-KSB, as amended,
for the year ended December 31, 1996 have been audited by BDO Seidman, LLP,
independent certified public accountants, as set forth in their report thereon
included therein and incorporated herein by reference. Such financial statements
are, and audited financial statements to be included in subsequently filed
documents will be, incorporated herein in reliance upon the reports of BDO
Seidman, LLP pertaining to such financial statements (to the extent covered by
consents filed with the Securities and Exchange Commission) given upon the
authority of such firm as experts in accounting and auditing.
ADDITIONAL INFORMATION
The Company has filed with the Commission a Registration Statement on
Form S-3 under the Securities Act with respect to the Shares offered hereby. For
further information with respect to the Company and the securities offered
hereby, reference is made to the Registration Statement. Statements contained
-12-
<PAGE>
in this Prospectus as to the contents of any contract or other document are not
necessarily complete, and in each instance, reference is made to the copy of
such contract or document filed as an exhibit to the Registration Statement,
each such statement being qualified in all respects by such reference.
-13-
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The expenses in connection with the issuance and distribution of the
securities being registered, all of which will be paid by the Registrant, are as
follows:
SEC Registration Fee........................... $1,421.85
Accounting Fees and Expenses................... 10,000.00
Legal Fees and Expenses........................ 10,000.00
Blue Sky Fees and Expenses..................... 0.00
Miscellaneous Expenses......................... 0.00
----------
Total.......................................... $21,421.85
==========
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Article "3" of the Company's Certificate of Incorporation contains the
following provision with respect to limiting the liability of Directors:
"3. The personal liability of the directors of the corporation
is hereby eliminated to the fullest extent permitted by the provisions
of paragraph (b) of Section 402 of the Business Corporation Law of the
State of New York, as the same may be amended and supplemented. Any
repeal or modification of this Article by the shareholders of the
Company shall not adversely affect any right or protection of a
director of the Company existing hereunder with respect to any act or
omission occurring prior to such repeal or modification."
Section 721 through 726 inclusive of the New York Business Corporation
Law (the "New York BCL") also contain provisions relating to the indemnification
of officers and directors. The New York BCL provides that a corporation may (but
is not required to) indemnify a director or officer against judgments, fines,
amounts paid in settlement and reasonable expenses of litigation (other than in
an action brought by the corporation against such person or by shareholders
against such person on behalf of the corporation), even if the director or
officer is not successful on the merits, if he acted in good faith and for a
purpose he reasonably believed to be in (or not opposed to) the best interests
of the corporation (and, criminal actions or proceedings, had no reason to
believe his conduct was unlawful). In addition, a corporation may (but is not
required to) indemnify a director or officer against amounts paid in settlement
and reasonable expenses of an action brought against him by the corporation or
by shareholders on behalf of the corporation, even if he is not successful on
the merits, if he acted in good faith and for a purpose he reasonably believed
to be in (or not opposed to) the best interests of the corporation. However, no
indemnification is permitted in an action by the corporation, or shareholders on
behalf of the corporation, in connection with the settlement or other
disposition of a threatened or pending action or in connection with any claim,
issue or matter as to which a director or officer is adjudged to be liable to
the corporation, unless a court determines that, in view of all of the
circumstances, he is entitled to indemnity for such portion of the settlement
amount and expenses as the court deems proper. In addition, the New York BCL
provides that a director or officer shall be indemnified if such person is
successful in the litigation on the merits or otherwise.
Permitted indemnification as described above may only be made if it is
authorized by the Board of Directors, in each specific case, based upon a
determination that the applicable standard of conduct has been met or that
indemnification is proper under New York BCL Section 721. Such authorization is
made by the Board of Directors, either acting as a quorum of disinterested
directors or based upon an opinion by independent legal counsel or the
shareholders that indemnification is proper because the applicable standard of
conduct has been met. Upon application of the person seeking indemnification,
II-1
<PAGE>
a court may also award indemnification upon a determination that the standards
outlined above have been met. A corporation's board of directors may also
authorize the advancement of litigation expenses to a director or officer upon
receipt of an undertaking by him to repay such expenses, if it is ultimately
determined that he is not entitled to be indemnified for them.
ITEM 16. EXHIBITS.
EXHIBIT INDEX
EXHIBIT
*5 Opinion of Olshan Grundman Frome & Rosenzweig LLP with respect
to the securities registered hereunder.
23(a) Consent of Arthur Andersen LLP.
23(b) Consent of BDO Seidman, LLP.
*23(c) Consent of Olshan Grundman Frome & Rosenzweig LLP (included
within Exhibit 5).
24(a) Powers of Attorney (included on the Signature page of this
Registration Statement).
* Previously filed.
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes:
a) To file, during any period in which offers or
sales are being made, a post-effective amendment to this registration statement
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.
b) 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.
c) 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.
The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
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 for
indemnification against each such liabilities (other than the payment by the
registrant of
II-2
<PAGE>
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.
II-3
<PAGE>
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements of filing on Form S-3 and authorizes this Registration
Statement to be signed on its behalf by the undersigned, the City of New York,
State of New York, on the 15th day of September, 1998.
HOSPITALITY WORLDWIDE SERVICES, INC.
(Registrant)
By:/s/ Robert A. Berman
----------------------------------------
Robert A. Berman, President, Chief
Executive Officer and Director
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints each of Robert A. Berman and Howard G.
Anders his true and lawful attorneys-in-fact and agent, with full power of
substitution and resubstitution, for and in his or her name, place and stead, in
any and all capacities, to sign any or all 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, granting
unto said attorney-in-fact and agent, full power and authority to do and perform
each and every act and thing requisite necessary to be done in and about the
premises, as fully to all intents and purposes as he or she might or could do in
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his or her substitute, 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.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
/s/ Robert A. Berman Chairman of the Board and Chief Executive September 15, 1998
- --------------------------- Officer (principal executive officer)
Robert A. Berman
* Chairman of the Board and Director September 15, 1998
- ---------------------------
Leonard F. Parker
/s/ Howard G. Anders Executive Vice President, Chief Financial September 15, 1998
- --------------------------- Officer (principal financial officer and
Howard G. Anders principal accounting officer) and Secretary
* President and Chief Operating Officer September 15, 1998
- --------------------------
Douglas Parker
* Director September 15, 1998
- --------------------------
Louis K. Adler
* Director September 15, 1998
- --------------------------
George Asch
* Director September 15, 1998
- --------------------------
Richard A. Bartlett
* Director September 15, 1998
- --------------------------
Scott Kaniewski
*By:/s/ Howard G. Anders
--------------------
Howard G. Anders
Attorney-in-fact
</TABLE>
II-4
<PAGE>
EXHIBIT INDEX
EXHIBIT
*5 Opinion of Olshan Grundman Frome & Rosenzweig LLP with respect
to the securities registered hereunder.
23(a) Consent of Arthur Andersen LLP.
23(b) Consent of BDO Seidman, LLP.
*23(c) Consent of Olshan Grundman Frome & Rosenzweig LLP (included
within Exhibit 5).
24(a) Powers of Attorney (included on the Signature page to the
Registration Statement).
* Previously filed
II-5
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement on Form S-3 of our report dated March
30, 1998 included in Hospitality Worldwide Services, Inc.'s Form 10-K for the
year ended December 31, 1997 and to all references to our Firm included in this
Registration Statement.
/s/ Arthur Andersen LLP
-----------------------
Arthur Andersen LLP
New York, New York
September 10, 1998
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Hospitality Worldwide Services, Inc.
New York, New York
We hereby consent to the incorporation by reference in the Prospectus
constituting a part of this Registration Statement of Hospitality Worldwide
Services, Inc. on Form S-3 of our report dated March 21, 1997, relating to the
consolidated financial statements of Hospitality Worldwide Services, Inc. and
subsidiary appearing in the Annual Report on Form 10-K of Hospitality Worldwide
Services, Inc. for the year ended December 31, 1997.
We also consent to the reference to us under the caption "Experts" in the
Prospectus.
/s/ BDO Seidman LLP
- -------------------
BDO Seidman LLP
New York, New York
September 10, 1998
