<PAGE> 1
As filed with the Securities and Exchange Commission on June 13, 2000.
Registration No. 333-_____
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
FRESH AMERICA CORP.
(Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>
TEXAS 76-0281274
-------------------------------------------------------------- ------------------------------------
<S> <C>
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
</TABLE>
6600 LBJ FREEWAY, SUITE 180
DALLAS, TEXAS 75240
(972) 774-0575
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
---------------
David I. Sheinfeld COPIES TO:
Chairman of the Board and President Alan J. Bogdanow
6600 LBJ Freeway, Suite 180 Hughes & Luce, L.L.P.
Dallas, Texas 75240 1717 Main Street, Suite 2800
(972) 774-0575 Dallas, Texas 75201
(214) 939-5500
(Name, address, and telephone number, including area code,
of agent for service)
---------------
Approximate date of commencement of proposed sale to the public: From time to
time after the effective date of this Registration Statement.
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 of the Securities Act of 1933,
other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: [X]
If this form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration 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: [ ]
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
======================================================================================================================
AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF SHARES TO BE AGGREGATE PRICE AGGREGATE REGISTRATION
TO BE REGISTERED REGISTERED (1) PER SHARE (2) OFFERING PRICE (2) FEE
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
<S> <C> <C> <C> <C>
Common Stock,
$.01 par value 576,134 $1.938 $1,116,548 $295
========================= ====================== ======================= ====================== ======================
</TABLE>
(1) Includes (i) up to 155,483 shares of Fresh America Corp. Common Stock to be
issued upon exercise of Series A warrants, (ii) up to 420,651 shares of
Fresh America Corp. Common Stock issuable upon exercise of Series B
warrants and (iii) an indeterminate number of additional shares of Fresh
America Corp. Common Stock as may from time to time become issuable upon
exercise of the warrants by reason of stock splits, stock dividends and
similar transactions, which shares are registered hereunder pursuant to
Rule 416 under the Securities Act of 1933, as amended.
(2) Estimated solely for the purpose of calculating the registration fee,
calculated pursuant to Rule 457(c) of the Securities Act of 1933, as
amended, based upon the high and low price per share of Fresh America Corp.
Common Stock on June 8, 2000, as reported by the Nasdaq Stock Market's
National Market.
---------------
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 THAT SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THIS REGISTRATION STATEMENT SHALL
BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION
8(a), MAY DETERMINE.
<PAGE> 2
576,134 SHARES
FRESH AMERICA CORP.
COMMON STOCK
------------------------------------
We have issued 155,483 Series A warrants to purchase 155,483 shares of
our common stock and 420,651 Series B warrants to purchase 420,651 shares of our
common stock. These warrants were issued pursuant to the terms of an Amended and
Restated Warrant Agreement, dated as of April 15, 2000, between us and the
shareholders listed below under the caption "Selling Shareholders." These
Selling Shareholders can use this prospectus to sell to other purchasers some or
all of the shares of our common stock they will receive by exercising their
warrants.
The offering of shares of our common stock under this prospectus is
being made by the Selling Shareholders only. It is not part of an original
issuance by us of shares of our common stock. Accordingly, all of the net
proceeds from the sale of shares of our common stock offered under this
prospectus will go to the Selling Shareholders who offer and decide to sell
their shares.
We will not receive any of the proceeds from the Selling Shareholders'
sale of their shares. However, we may receive cash consideration in connection
with the exercise of the warrants held by the Selling Shareholders. We are
paying for the costs of registering the shares covered by this prospectus, other
than commissions, fees and discounts of underwriters, brokers, dealers and
agents, if any.
The Selling Shareholders may offer their shares of our common stock in
transactions on the Nasdaq Stock Market's National Market (the "Nasdaq"), in
negotiated transactions, through a combination of these methods or in any other
legal way. The Selling Shareholders may offer their shares of our common stock
at prevailing market prices, at prices related to market prices, at fixed prices
that may change or at privately negotiated prices.
See below under the caption "Plan of Distribution."
Our common stock is quoted on the Nasdaq and trades under the symbol
"FRES." On June 8, 2000, the closing price of one share of our common stock, as
reported on the Nasdaq, was $1.938.
------------------------------------
THIS INVESTMENT IN SHARES OF OUR COMMON STOCK INVOLVES A HIGH DEGREE OF
RISK. YOU SHOULD CAREFULLY CONSIDER THE "RISK FACTORS" BEGINNING ON PAGE 5.
------------------------------------
THE SECURITIES AND EXCHANGE COMMISSION AND STATE SECURITIES REGULATORS HAVE NOT
APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS
TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------------------------------
The shares of common stock being offered under this prospectus are not
being offered in any jurisdiction where the offer is not permitted.
The information contained in this prospectus is accurate only as of the
date of this prospectus, regardless of the time of delivery of this prospectus
or of any sale of shares of our common stock offered under this prospectus.
This prospectus is dated June 12, 2000.
1
<PAGE> 3
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the informational reporting requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"). Accordingly,
we file reports, proxy statements, information statements and other information
with the Securities and Exchange Commission (the "Commission"). You may read and
copy the various reports, proxy statements, information statements, and other
information that we file with the Commission pursuant to the requirements of the
Exchange Act at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549-1004 and at the following regional offices of the Commission: New
York Regional Office, Seven World Trade Center, Suite 1300, New York, New York
10048; and Chicago Regional Office, Northwestern Atrium Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60606. Copies of such materials may be
obtained from the Public Reference Room of the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549, at prescribed rates. Also, the Commission
maintains a Web site that contains our various Commission filings and other
information about the Company. The Commission's Web site address is
http://www.sec.gov.
We are a publicly held corporation, and our common stock is traded on
the Nasdaq under the symbol "FRES." You may review copies of our various
reports, proxy statements, information statements and other information at the
offices of the Nasdaq National Market, 1735 K Street, N.W., Washington, D.C.
20549.
We intend to furnish our shareholders with annual reports containing
audited consolidated financial statements and other periodic reports as we may
determine or as may be required by law.
This prospectus constitutes a part of a registration statement on Form
S-3 (together with all exhibits to such registration statement, the
"Registration Statement") that we have filed with the Commission under the
Securities Act of 1933, as amended, (the "Securities Act"). This prospectus does
not contain all information included in the Registration Statement. Certain
parts of the Registration Statement have been omitted in accordance with the
rules and regulations of the Commission. For further information, please refer
to the Registration Statement which can be inspected on the Commission's Web
site or at the public reference rooms at the offices of the Commission.
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<PAGE> 4
DOCUMENTS INCORPORATED BY REFERENCE
The Commission allows us to "incorporate by reference" certain
information and reports that we file with it. Accordingly, this prospectus
incorporates by reference the following documents previously filed by us with
the Commission pursuant to the Securities Act and the Exchange Act, and these
documents shall be deemed a part of this prospectus:
(i) our Annual Report on Form 10-K, which contains audited consolidated
financial statements as of December 31, 1999 and January 1, 1999 and for each of
the fiscal years in the three year period ended December 31, 1999 (File No.
000-24124);
(ii) our Quarterly Report on Form 10-Q for the quarterly period ended
March 31, 2000 (File No. 000-24142); and
(iii) a description of the common stock contained in our registration
statement on Form 8-A, dated May 12, 1994 (File No. 000-24124), including
amendments or reports filed for the purpose of updating such description.
All of the documents that we file with the Commission pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this
prospectus and before the termination of the offering relating to this
prospectus will be deemed to be incorporated by reference in this prospectus and
to constitute a part of this prospectus from the date that such documents are
filed with the Commission. For purposes of this prospectus, any statement that
is incorporated or deemed to be incorporated by reference in this prospectus
will be deemed to be modified, replaced, or superseded by a statement contained
in this prospectus or contained in any other subsequently filed document that
also is or is deemed to be incorporated by reference in this prospectus. Such
modified or superseded statement will be deemed, except as so modified or
superseded, to constitute a part of this prospectus.
3
<PAGE> 5
You may request, at no cost, copies of any or all of the documents
incorporated by reference in this prospectus (other than the exhibits to such
documents, unless such exhibits are specifically incorporated by reference into
the information that this prospectus incorporates) by writing or telephoning us
at:
Fresh America Corp.
6600 LBJ Freeway
Suite 180
Dallas, Texas 75240
Attn: Chief Financial Officer
Telephone: (972) 774-0575
THE COMPANY
We are a major North American fresh produce distribution company. The
Company's services include regional/centralized purchasing, warehousing,
distribution, logistics, systems and customer support. We serve over 4,000
customers and operate in 42 states and Canada through 16 distribution and
processing facilities located in Arizona, California, Florida, Georgia,
Illinois, Indiana, Pennsylvania, Texas and Ontario, Canada.
We are a Texas corporation. Our principal offices are located at 6600
LBJ Freeway, Suite 180, Dallas, Texas 75240 (telephone number 972/774-0575).
4
<PAGE> 6
RISK FACTORS
You should carefully consider the following risk factors and warnings
before making an investment decision. The risks described below are not the only
ones that we face. Additional risks that we do not yet know of or that we
currently think are immaterial may also impair our business operations. If any
of the following risks actually occur, our business, financial condition or
results of operations could be materially adversely affected. In such case, the
trading price of our common stock could decline, and you may lose all or part of
your investment. You should also refer to the other information set forth and
incorporated by reference in this prospectus.
This prospectus and the information incorporated by reference in this
prospectus contain forward-looking statements. These statements refer to future
events or our future financial performance. In some cases, you can identify
forward-looking statements by terminology such as "may," "will," "should,"
"expects," "anticipates," "plans," "believes," "estimates," "predicts,"
"potential" or "continue" or the negative of such terms and other comparable
terminology. These statements are only predictions. Actual events or results may
differ materially. In evaluating these statements, you should specifically
consider various factors, including the risks outlined below. These factors may
cause our actual results to differ materially from those expressed in
forward-looking statements made or incorporated by reference in this prospectus,
or in any other SEC filings or public statements we may make. We undertake no
obligation to publicly update any forward-looking statements, whether as a
result of new information, future events or otherwise.
OUR LEVERAGE IS SUBSTANTIAL, MAKING IT MORE DIFFICULT TO RESPOND TO CHANGING
BUSINESS CONDITIONS.
As of March 31, 2000, we had $51.2 million of debt, consisting primarily of
our senior credit facility, subordinated debt and Canadian revolving credit
facility. On May 1, 2000, we issued $5.0 million of redeemable preferred stock.
Our financial advisor is also seeking to raise additional capital in the form of
preferred stock or subordinated debt. The degree to which we are leveraged:
o could materially limit or impair our ability to obtain
additional financing or refinancing in the future for working
capital, capital expenditures, acquisitions, general corporate
purposes or other purposes;
o will require us to dedicate a substantial portion of our cash
flow to the payment of principal and interest on our
indebtedness and dividends on our preferred stock, which
reduces the availability of cash flow to fund working capital,
capital expenditures and growth opportunities; and
o will increase our vulnerability to economic downturns, limit
our ability to withstand competitive pressures and reduce our
flexibility in responding to changing business and economic
conditions.
5
<PAGE> 7
WE WILL REQUIRE A SIGNIFICANT AMOUNT OF CASH TO SERVICE OUR INDEBTEDNESS AND
PREFERRED STOCK; OUR ABILITY TO GENERATE CASH DEPENDS ON MANY FACTORS BEYOND OUR
CONTROL.
Our ability to make scheduled payments with respect to indebtedness and
preferred stock will depend upon, among other things:
o our ability to achieve significant and sustained growth in cash
flow;
o successful operation of our business;
o produce commodity pricing;
o our ability to expand or generate new customer relationships to
offset the loss of our Sam's business in November 2000; and
o our ability to complete additional financings.
Each of these factors is affected by economic, financial, competitive
and other factors, many of which are beyond our control. If we are unable to
generate sufficient cash flow to service our indebtedness or preferred stock, we
may have to reduce or divest certain operations, restructure or refinance our
indebtedness or preferred stock or seek additional equity capital.
POTENTIAL ADVERSE EFFECT OF EXPANDING OUR BUSINESS.
Our management has stated its intention to expand and diversify our
customer base, geographic coverage, market penetration and service offerings
through leveraging the infrastructure of our existing businesses. These
opportunities will be subject to all of the risks inherent in the establishment
of a new product or service offering, including intense competition, lack of
sufficient customer demand or change in customer tastes, inadequate assured
sources of quality product supply and unforeseen complications, delays and cost
increases. Some of our prior acquisitions were not successfully integrated into
our business and there can be no assurance that we will succeed in integrating
such new business into our existing infrastructure.
LOSS OF SAM'S CLUB AS A CUSTOMER WILL ADVERSELY AFFECT OUR BUSINESS.
Sam's Club, a division of Wal-Mart Stores, Inc. ("Sam's" or "Clubs"),
is our primary customer and accounted for approximately 31%, 37% and 55% of our
sales for fiscal 1999, 1998 and 1997, respectively. Our relationship with Sam's
is governed by the terms and conditions of a five-year agreement (the
"Agreement") that became effective December 1, 1995 and expires on November 30,
2000. Under the terms of the Agreement, Sam's has withdrawn 40 clubs per year
from service since 1997 as Wal-Mart or Sam's Club distribution centers opened to
provide direct service to Wal-Mart Supercenters and/or Sam's Clubs. Currently,
we provide service to 238 Clubs. Our expansion strategy was designed in part to
reduce our dependence on Sam's over the five-year term of the Agreement through
strategic acquisitions as well as the expansion of program sales and
distribution and value-added products.
The loss of Sam's business after the agreement expires will adversely
affect our revenues and related profitability beyond November 30, 2000. Sam's
currently contributes approximately
6
<PAGE> 8
one-third of our revenue base. While the loss of Sam's business will mean the
elimination of substantial related operating expenses, our operating income may
be reduced to a greater extent than our revenues because we may not be able to
eliminate all of our Sam's related expenses and because the Sam's business has
been one of our higher operating margin programs.
THE TERMS OF OUR SENIOR SECURED REVOLVING CREDIT FACILITY AND SUBORDINATED DEBT
IMPOSE RESTRICTIONS ON OUR OPERATIONS.
The terms and conditions of our senior secured revolving credit
facility impose restrictions that affect, among other things, our ability to
incur debt, make capital expenditures, merge, sell assets, make distributions,
or create or incur liens. Availability of our credit facility is also subject to
scheduled principal reductions and is further limited to predetermined amounts
in excess of a computed borrowing base. Our ability to comply with these
requirements can be affected by events beyond our control and there can be no
assurance that we will achieve operating results that comply with the provisions
of the credit agreement. A breach of these covenants could result in a default
under our credit facility. In the event of a default, the bank could elect to
declare the outstanding principal amount or our credit facility, all interest
thereon and all other amounts payable under our credit facility to be
immediately due and payable. Our subordinated debt also contains various
restrictions, which if not complied with could result in a default and possible
acceleration of such debt. Acceleration of such debt would also cause the
Preferred Stock to become immediately redeemable.
Our ability to satisfy our debt obligations will depend upon our future
operating performance, which will be affected by prevailing economic, financial
and business conditions and other factors, some of which are beyond our control.
WE MAY NOT BE ABLE TO RAISE NEEDED FUNDS.
During the last six months of 1999 to enhance cash flow, we reduced
overhead levels, closed or sold underperforming operations and redirected
resources away from a capital-intensive acquisition strategy to a strategy that
further enhances and better leverages our existing infrastructure. During 2000,
we intend to sell our Houston distribution center previously dedicated to our
Sam's business and we expect to also receive a substantial tax refund for
Federal income taxes paid in 1997 and 1998. In April 2000, our Subordinated
Lender purchased $5.0 million of Preferred Stock and extended the payment terms
of their debt. These actions, coupled with our operating cash flow, will be used
to make mandatory reductions to our revolving credit facility during 2000.
We also intend to further strengthen our balance sheet by issuing
additional preferred equity and refinancing our senior debt. There can be no
assurance that we will be able to generate sufficient cash flow or raise
additional debt or equity capital on satisfactory terms in order to refinance
our senior credit facility and expand our business. Changes in interest rates,
market liquidity, stock prices and general market conditions may all affect our
ability to raise funds.
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<PAGE> 9
POTENTIAL ADVERSE EFFECTS OF PRICE AND QUALITY FLUCTUATIONS.
Prices of high quality fresh produce are extremely volatile based on
available supply, which can be significantly affected by factors such as
weather, disease and level of agricultural production. Both our sales and
profitability could be negatively affected during periods of exceptionally high,
low or volatile prices or when we cannot obtain sufficient high quality produce.
During periods of lower produce prices, our operating income is adversely
affected because we have less gross margin to cover operating expenses.
WE OPERATE IN HIGHLY COMPETITIVE MARKETS.
We operate in highly competitive markets, and our success will be
largely dependent on our ability to provide quality products at the lowest
possible prices. We compete with food service companies, produce distribution
companies and wholesale food distribution companies, some of which have
substantially greater financial resources. There can be no assurance that we
will be able to compete successfully with current or future competitors.
LOSS OF KEY PERSONNEL COULD ADVERSELY AFFECT OUR BUSINESS.
Our future success will depend to a significant extent on the efforts
and abilities of our senior management. The loss of the services of one or more
of our senior managers could have a material adverse effect on us.
WE HAVE A SEASONAL BUSINESS.
Our business is seasonal, with our highest sales and net income
historically occurring during our fourth fiscal quarter. Any adverse development
affecting our operations during this period, such as the unavailability of high
quality produce or harsh weather conditions, could have a disproportionate
impact on our results of operations for the full year.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains or incorporates by reference "forward-looking
statements" within the meaning of Section 27A of the Securities Act and Section
21E of the Exchange Act that are subject to risks and uncertainties. These
statements involve known and unknown risks, uncertainties, and other factors
that may cause our or our industry's actual results, levels of activity,
performance, or achievements to be materially different from any future results,
levels of activity, performance, or achievements expressed or implied by such
forward-looking statements. Such factors include, among others, those listed
under "Risk Factors" and elsewhere in this prospectus and information
incorporated by reference in this prospectus.
In some cases, you can identify forward-looking statements by
terminology such as "may," "will," "should," "expects," "anticipates," "plans,"
"believes," "estimates," "predicts," "potential" or "continue" or the negative
of such terms or other comparable terminology.
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<PAGE> 10
Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee future results,
levels of activity, performance or achievements.
Moreover, neither we nor any other person assumes responsibility for
the accuracy and completeness of any such forward-looking statements. We are
under no duty to update any of the forward-looking statements after the date of
this prospectus to conform such statements to actual results.
SELLING SHAREHOLDERS
On May 4, 1998, we sold $20,000,000 of our 12% Senior Subordinated
Notes due May 1, 2003 to John Hancock Life Insurance Company and certain of its
affiliates, together with the 155,483 Series A warrants, for $20,000,000. On
April 28, 2000, we sold 50,000 shares of the Series C redeemable cumulative
preferred stock to John Hancock Life Insurance Company and certain of its
affiliates, together with the 420,651 Series B warrants, for $5,000,000. The
shares of common stock to be sold pursuant to the offering under this prospectus
are the shares of common stock, if any, that we may issue to the Selling
Shareholders in connection with the Amended and Restated Warrant Agreement,
between the Company and the Selling Shareholders, dated as of April 15, 2000
upon their exercise of the Series A warrants or Series B warrants. In connection
with the Amended and Restated Warrant Agreement, we agreed to register the
shares of our common stock that would be received by the Selling Shareholders
upon exercise of their warrants so that they may resell their common stock if
they so desire. See "Description of Securities."
The table below sets forth information with respect to the Selling
Shareholders' ownership of our common stock immediately prior to this offering
and as adjusted to reflect the sale of shares of common stock pursuant to this
offering. All information with respect to the Selling Shareholders' ownership in
our common stock has been furnished by the Selling Shareholders.
<TABLE>
<CAPTION>
Ownership Ownership
Prior to Offering After Offering
---------------------------------------- -------------------------
Number of Percent of Shares to Number of Percent of
Name of Selling Shareholders Shares Class (1) be Sold (2) Shares (2) Class (2)
---------------------------- ---------- ------------ ----------- ---------- -----------
<S> <C> <C> <C> <C> <C>
John Hancock Life Insurance Company 503,611 (3) 8.8% 503,611 0 0%
John Hancock Variable Life Insurance 48,562 (4) 1.0% 48,562 0 0%
Company
Signature (1A) Cayman, Ltd. 15,548 (5) * 15,548 0 0%
Investors Partner Life Insurance Company 8,413 (6) * 8,413 0 0%
</TABLE>
---------------
*Less than 1%
(1) Percentages are based on the total number of shares outstanding at June
8, 2000, plus the total number of outstanding securities held by such
person that are exchangeable into the Company's common stock within 60
days of such date. Shares issuable upon the conversion of securities
exchangeable into the Company's common stock, however, are not deemed
outstanding for purposes of computing the percentage ownership of any
other person.
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<PAGE> 11
(2) Assumes all the shares of common stock that may be offered are sold.
The Selling Shareholders may sell all, some or none of the shares they
hold.
(3) Includes 116,612 shares of common stock issuable upon exercise of
Series A warrants and 386,999 shares of common stock issuable upon
exercise of Series B warrants.
(4) Includes 23,323 shares of common stock issuable upon exercise of Series
A warrants and 25,239 shares of common stock issuable upon exercise of
Series B warrants.
(5) Includes 15,548 shares of common stock issuable upon exercise of Series
A warrants.
(6) Includes 8,413 shares of common stock issuable upon exercise of Series
B warrants.
In addition to the warrants exercisable into the shares of our common
stock which the Selling Shareholders may sell under this prospectus, John
Hancock Life Insurance Company and its affiliates own other of our securities as
follows:
<TABLE>
<CAPTION>
Share of Series C
Principal amount of Senior Redeemable Cumulative
Subordinated Notes Preferred Stock
<S> <C> <C>
John Hancock Life Insurance Company $13,000,000 46,000
John Hancock Life Insurance Company (on behalf of a separate 2,000,000
account)
John Hancock Variable Life Insurance Company 3,000,000 3,000
Signature 1A (Cayman), Ltd. 2,000,000 --
Investors Partner Life Insurance Company -- 1,000
----------- -------
TOTAL $20,000,000 50,000
</TABLE>
USE OF PROCEEDS
We may receive cash consideration in connection with the exercise of
the warrants held by the Selling Shareholders. Alternatively, the Selling
Shareholders may pay the exercise price by surrendering either a principal
amount of subordinated notes equal to the exercise price or a number of shares
of the Series C redeemable cumulative preferred stock, or through the cashless
exercise feature described below under "DESCRIPTION OF SECURITIES". In any of
those cases, we will receive no cash proceeds upon exercise of warrants. We will
not receive any proceeds from the sale by the Selling Shareholders of any of the
shares offered with this prospectus. We intend to use any cash proceeds that we
may receive in connection with these exercises for general corporate purposes,
including working capital. We will pay all of the costs of this offering other
than commissions, fees and discounts of underwriters, brokers, dealers and
agents, if any.
DETERMINATION OF OFFERING PRICE
Because this prospectus relates only to the resale of previously issued
shares of common stock, we did not determine an offering price. The Selling
Shareholders will individually
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<PAGE> 12
determine the offering price of the common stock. The price at which the common
stock is sold may be based on market prices prevailing at the time of sale, at
prices relating to such prevailing market prices, at fixed prices that may be
changed, or at negotiated prices.
PLAN OF DISTRIBUTION
The shares of our common stock being offered by this prospectus may be
sold from time to time by the Selling Shareholders and by their pledgees,
donees, transferees, successors or others who may later hold their interests
(the "Sellers"). The Sellers may sell their shares, directly or through one or
more dealers, brokers or agents, on the Nasdaq National Market or otherwise. The
Sellers may sell some or all of their shares of our common stock through any of
the following transactions or any other lawful transaction:
o ordinary brokerage transactions and transactions in which a broker
solicits purchasers;
o a block trade in which a broker or dealer will try to sell the shares as
agent, but may buy and resell a portion of the block as principal in order
to facilitate the transaction;
o purchases by a broker or dealer as principal and resale by the broker or
dealer for its account;
o purchases by a broker or dealer of a fixed number of shares at a
stipulated price per share;
o exchange distributions in accordance with the rules of the exchange on
which it takes place; or o privately negotiated transactions.
The Sellers may pledge their shares to a lender as collateral for a loan, and
may pledge or loan their shares to a broker or dealer, under the margin
provisions of a customer agreement or otherwise. If the Seller defaults on the
loan, the lender, broker or dealer to whom the shares were pledged or loaned
may, from time to time, offer or sell the shares under this prospectus or
otherwise. In addition, the Sellers may engage in hedging and other transactions
involving their shares, such as short sales, option transactions (involving
standardized options or in privately negotiated transactions) and other hedging
and derivative transactions. The Sellers may then deliver some or all of their
shares upon settlement of these transactions.
The prices in these sale, loan or hedging transactions may be prevailing
market prices, prices relating to market prices, at fixed prices that may be
changed and at negotiated prices. Brokers and dealers who sell the shares of our
common stock for the Sellers, whether acting as principal or agent, may receive
compensation in the form of discounts, concessions or commissions from the
Sellers or the purchasers of their shares, or both. That compensation may or may
not exceed customary compensation. The Sellers and any brokers or dealers who
act in connection with the sale of the Sellers' shares of our common stock may
be deemed to be "underwriters" within the meaning of Section 2(11) of the
Securities Act, and any discounts, concessions or commissions they receive or
profit they realize from the resale of our shares may be deemed to be
underwriting discounts and commissions under the Securities Act. The Company has
agreed with the Selling Shareholders to indemnify the Sellers and such brokers
and dealers against certain liabilities.
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<PAGE> 13
Under certain circumstances, the Sellers may agree to indemnify such brokers or
dealers against certain liabilities. These liabilities may include liabilities
under the Securities Act.
The Sellers may use this prospectus from time to time to sell their common
stock. In addition to selling their common shares under this Prospectus, the
Sellers may, to the extent permitted by Rule 144 under the Securities Act, sell
their shares pursuant to such Rule 144. To the extent that it is legal to do so,
the Sellers may also transfer their common shares in other ways not involving
market makers or established trading markets.
To the extent required by law, we will prepare, provide with this
Prospectus and file with the Securities and Exchange Commission a prospectus
supplement disclosing any additional material facts or circumstances concerning
the plan of distribution or otherwise.
In order to comply with certain states' securities laws, if applicable,
the common stock will be sold in such jurisdictions only through registered or
licensed brokers or dealers. In certain states, the common stock may not be sold
unless the common stock has been registered or qualified for sale in that state
or an exemption from registration or qualification is available and is complied
with.
DESCRIPTION OF SECURITIES
COMMON STOCK
For a description of our common stock, see our Registration Statement
on Form 8-A filed with the SEC on May 14, 1994 and incorporated by reference
into this prospectus.
SERIES C CUMULATIVE REDEEMABLE PREFERRED STOCK
Pursuant to the Securities Purchase Agreement between us and John
Hancock Life Insurance Company and certain of its affiliates, dated as of April
15, 2000, we issued 50,000 shares of Series C Cumulative Redeemable Preferred
Stock, $1.00 par value per share.
Preferred Dividends. The holders of our preferred stock are entitled to
receive cumulative dividend payments of $6.00 per share, payable semi-annually.
We may not pay dividends on or redeem any of our common stock unless we are
current in the payment of the dividends on the preferred stock. Unless redeemed
at an earlier date, our preferred stock is required to be redeemed on April 30,
2007.
Redemption. We must redeem all the preferred stock upon the occurrence
of any of certain insolvency events, such as the appointment of a receiver or
trustee for us or the filing of a bankruptcy petition. We must redeem the
preferred stock upon the request of the holders of a majority of the shares of
the preferred stock if:
12
<PAGE> 14
o we fail to pay accumulated dividends to the holders of the
preferred stock for two dividend periods,
o any representation made to the initial purchasers of the preferred
stock was untrue or misleading in any material way when made,
o we fail to make any required payment of more than $2,000,000 in
respect of the Subordinated Notes or any court judgment, or
o any person other than one of our current directors or successors
nominated or approved by a majority vote of the incumbent board of
directors shall become one of our directors.
In addition, we may redeem shares of the preferred stock at any time at our
option.
Upon redemption of any shares of the preferred stock, we must pay the
holders of the redeemed shares a redemption price equal to the greater of (i)
$100 per share plus all accrued any unpaid dividends, or (ii) the amount that
would be necessary to yield the holder an internal rate of return of 18% per
annum in respect of the redeemed shares and that holder's ratable proportion of
the Series B warrants.
Voting Rights. The holders of our preferred stock will have certain
voting rights, including the right to vote separately as a single class in the
election of two additional directors on our Board of Directors in the event (i)
we fail to pay accumulated dividends to the holders of preferred stock for two
dividend periods, or (ii) we fail to properly redeem shares of preferred stock
when such redemption obligation is triggered.
Ranking. The preferred stock will rank senior to our common stock for
purposes of distributing our assets in the event we must liquidate, dissolve or
wind up our business.
SERIES A WARRANTS AND SERIES B WARRANTS
Pursuant to the Amended and Restated Warrant Agreement, dated as of
April 15, 2000, we issued the Series A Warrants and the Series B Warrants to the
Selling Shareholders. The Series A Warrants replaced warrants issued to the
Selling Shareholders under a warrant agreement dated May 4, 1998. The Series A
Warrants and the Series B Warrants (the "Warrants") have the same material
terms.
Exercise of Warrants. The Warrants may be exercised at any time after
issuance. The Warrants expire on August 31, 2007.
Exercise and Anti-Dilution. Each Warrant allows the holder to purchase
one share of our common stock for $3.25 per share. The number of shares of our
common stock that may be purchased upon exercise of each warrant and the
purchase price are subject to customary anti-dilution adjustments upon such
events as the subdivision or combination of the common stock, the distribution
of our assets to holders of common stock, certain issuance of stock or options
for less than fair market value, certain redemption of common stock for greater
than fair market value and other similar events.
13
<PAGE> 15
Cashless Exercise Option. The Warrant holders are entitled to pay the
exercise price in cash or to choose among one of two "cashless exercise"
options. The first cashless exercise option permits the holders to apply to the
exercise price either a like principal amount of our senior subordinated notes
or a number of shares of our Series C cumulative preferred stock having a
redemption price equal to the exercise price. The second cashless exercise
option entitles the Warrant holders to elect to receive fewer shares of common
stock without paying the cash exercise price. The number of shares to be issued
would be determined by a formula based on the total number of shares to which
the Warrant holder is entitled, the last reported sale price of the common stock
and the applicable exercise price of the Warrants.
Covenants. We made certain customary covenants with respect to the
Warrants, including, among others:
o we will have 100% of the underlying shares of common stock
authorized and reserved for issuance during the term of the
Warrants;
o the Warrants, and any common stock to be issued upon exercise of the
Warrants, are and will be duly authorized and validly issued; and
o we will pay any transfer taxes that may be payable in respect of the
initial issuance or delivery of the Warrants or the underlying
common stock.
Registration Rights. We are obligated to provide the Selling
Shareholders with certain registration rights, including the filing of this Form
S-3 and certain piggyback registration rights.
Amendment. Most provisions of the Warrants may be amended only after we
have obtained the written consent of 51% of the holders of the Warrant then
outstanding. However, changes to the amendment procedures or any defined term
require the written consent of all holders of Warrants then outstanding, and we
may not increase the exercise price of the Warrants, decrease the term of the
Warrants or decrease the amount of common stock issuable upon exercise of any
Warrant without the written consent of the holder of such Warrant.
LEGAL MATTERS
The validity of the common stock offered hereby will be passed upon for
us by Hughes & Luce, L.L.P., Dallas, Texas.
EXPERTS
The consolidated financial statements of Fresh America Corp. and its
subsidiaries as of December 31, 1999 and January 1, 1999, and for each of the
years in the three-year period ended December 31, 1999, 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.
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<PAGE> 16
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS. FRESH
AMERICA CORP. HAS NOT AUTHORIZED ANYONE TO PROVIDE PROSPECTIVE INVESTORS WITH
ANY DIFFERENT OR ADDITIONAL INFORMATION. THIS PROSPECTUS IS NOT AN OFFER TO SELL
NOR IS IT SEEKING AN OFFER TO BUY THESE SECURITIES 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 SECURITIES.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Where You Can Find More Information............. 2
Documents Incorporated by Reference............. 3
The Company..................................... 4
Risk Factors.................................... 5
Selling Shareholders............................ 9
Use of Proceeds................................. 10
Determination of Offering Price................. 11
Plan of Distribution............................ 11
Description of Securities....................... 12
Legal Matters................................... 14
Experts......................................... 15
</TABLE>
FRESH AMERICA CORP.
576,134 SHARES
COMMON STOCK
PROSPECTUS
JUNE 12, 2000
<PAGE> 17
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table indicates the estimated expenses to be incurred in
connection with the offering described in this Registration Statement, all of
which will be paid by us.
<TABLE>
<S> <C>
Registration fee $ 295
Accounting fees and expenses 3,000
Legal fees and expenses 7,500
Miscellaneous expenses 426
---------
Total: $ 11,221
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
As permitted by the Texas Business Corporation Act ("TBCA"), our Bylaws
provide that we will indemnify our directors and officers against certain
liabilities that those persons may incur in their capacities as directors or
officers. Furthermore, our Restated Articles of Incorporation eliminate the
liability of our directors to the maximum extent permitted by the TBCA.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to our directors, officers and controlling persons under
Texas law, our Articles of Incorporation or otherwise, 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 our payment of expenses incurred or paid by one of our directors,
officers, or controlling persons 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 our counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
us is against public policy as expressed in the Securities Act and will be
governed by the final adjudication of such issue.
ITEM 16. EXHIBITS.
The Exhibits to this Registration Statement are listed in the Index to
Exhibits on page II-6 of this Registration Statement, which Index is
incorporated herein by reference.
ITEM 17. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement:
II-1
<PAGE> 18
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act.
(ii) To reflect in the prospectus any facts
or events arising after the effective date of the
registration statement (or the most recent
post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change
in the information set forth in the registration
statement. Notwithstanding the foregoing, any
increase or decrease in the volume of securities
offered (if the total dollar value of securities
offered would not exceed that which was registered)
and any deviation from the low or high and of the
estimated maximum offering range may be reflected in
the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20
percent change in the maximum aggregate offering
price set forth in the "Calculation of Registration
Fee" table in the effective registration statement.
(iii) To include any material information
with respect to the plan of distribution not
previously disclosed in the registration statement or
any material change to such information in the
registration statement.
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the registration statement is on Form S-3, Form S-8 or Form
F-3, and the 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 Exchange
Act that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under
the Securities Act, 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.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) and 15(d) of the Exchange
Act (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Securities Act) 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.
(c) Insofar as indemnification for liabilities arising under the
Securities Act 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 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
II-2
<PAGE> 19
payment by the registrant of expenses incurred or paid by a director, officer,
or controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer, or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused the Registration
Statement on Form S-3 to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Dallas, State of Texas, on June 12, 2000.
FRESH AMERICA CORP.
By: /s/ John H. Gray
-------------------------------------------
John H. Gray,
Executive Vice President and
Chief Financial Officer
(Principal Financial and Accounting Officer)
II-3
<PAGE> 20
POWER OF ATTORNEY
We, the undersigned officers and directors of Fresh America Corp.,
hereby severally constitute and appoint Colon Washburn, David I. Sheinfeld and
John H. Gray and each of them singly, our true and lawful attorneys with full
power to them, and each of them singly, to sign for us and in our names in the
capacities indicated below, the Registration Statement on Form S-3 filed
herewith and any and all amendments (including post-effective amendments) to the
Registration Statement and Registration Statements related to the same offering,
and generally to do all things in our name and behalf in the capacities
indicated below to enable Fresh America Corp. to comply with the provisions of
the Securities Act of 1933, as amended, and all requirements to the Securities
and Exchange Commission, hereby ratifying and confirming our signatures as they
may be signed by our attorneys, or any of them, to said Registration Statement
and any and all amendments thereto.
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 dates indicated:
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Colon Washburn Chief Executive Officer June 12, 2000
------------------------------- and Director
Colon Washburn (Principal Executive Officer)
/s/ John H. Gray Executive Vice President and June 12, 2000
------------------------------- Chief Financial Officer
John H. Gray (Principal Financial and Accounting Officer)
/s/ Thomas M. Hubbard Director June 12, 2000
------------------------------
Thomas M. Hubbard
/s/ Sheldon I. Stein Director June 12, 2000
------------------------------
Sheldon I. Stein
/s/ Lawrence V. Jackson Director June 12, 2000
------------------------------
Lawrence V. Jackson
/s/ David I. Sheinfeld Chairman of the Board and President June 12, 2000
-------------------------------
David I. Sheinfeld
</TABLE>
II-4
<PAGE> 21
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
Number Description of Exhibits
------- -----------------------
<S> <C>
4.1 Form of Series A Warrant Certificate (filed as part of Exhibit
10.2 to the Company's Quarterly Report on Form 10-Q, dated as
of May 15, 2000 and incorporated herein by reference)
4.2 Form of Series B Warrant Certificate (filed as part of Exhibit
10.2 to the Company's Quarterly Report on Form 10-Q, dated as
of May 15, 2000 and incorporated herein by reference)
*5.1 Opinion of Hughes & Luce, L.L.P.
10.1 Amended and Restated Warrant Agreement with Respect To Warrant
Agreement Dated as of May 4, 1998, dated as of April 15, 2000
(filed as Exhibit 10.2 to the Company's Quarterly Report on
Form 10-Q, dated as of May 15, 2000 and incorporated herein by
reference).
10.2 Securities Purchase Agreement, dated as of April 15, 2000
(filed as Exhibit 10.4 to the Company's Quarterly Report on
Form 10-Q, dated as of May 15, 2000 and incorporated herein by
reference).
10.3 Omnibus Subordinated Guarantee (Including Amendment and
Restatement of Certain Existing guarantees) dated as of April
15, 2000 between Fresh America Corp. and John Hancock Mutual
Life Insurance Company (filed as Exhibit 10.3 to the Company's
Quarterly Report on Form 10-Q, dated as of May 15, 2000 and
incorporated herein by reference).
10.4 Amended and Restated Note Agreement dated as of April 15, 2000
with respect to note agreement dated as of May 4, 1998 between
Fresh America Corp. and John Hancock Mutual Life Insurance
Company (filed as Exhibit 10.1 to the Company's Quarterly
Report on Form 10-Q, dated as of May 15, 2000 and incorporated
herein by reference).
*23.1 Consent of Hughes & Luce, L.L.P. (included in Exhibit 5.1)
*23.2 Consent of KPMG LLP
*24.1 Power of Attorney (included in Part II of this Registration
Statement)
</TABLE>
---------------
* Filed Herewith.
II-5
