As Filed with the Securities and Exchange Commission on September 8, 2000
Registration No. 333-____
_______________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
TECHSYS, INC.
(Exact Name of Registrant as Specified in Its Charter)
New Jersey 22-3276736
---------- ----------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
44 Aspen Drive
Livingston, New Jersey 07039
(973) 422-1666
--------------
(Address, Including Zip Code, and Telephone Number, Including Area Code,
of Registrant's Principal Executive Offices)
Steven L. Trenk
TechSys, Inc.
44 Aspen Drive
Livingston, NJ 07039
(973) 422-1666
--------------
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code,
of Agent For Service)
Approximate Date of Commencement of Proposed Sale to the Public:
From time to time following 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 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box:
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 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
===============================================================================================================================
Title of Each Amount Proposed Maximum Proposed Maximum Amount of
Class of Securities to be Offering Price Aggregate Registration
To be Registered Registered(1) Per Unit Offering Price Fee
------------------------------- -------------------- ------------------------ ------------------------ ------------------------
<S> <C> <C> <C> <C>
Common Stock, no par value 10,344,166 $9.25(2) $95,683,535(2)
------------------------------- -------------------- ------------------------ ------------------------ ------------------------
Total Fee $25,261
------------------------------- -------------------- ------------------------ ------------------------ ------------------------
</TABLE>
(1) Pursuant to Rule 416, this Registration Statement also relates to an
indeterminate number of additional shares of Common Stock issuable upon exercise
of 8,550,000 warrants pursuant to stock splits, stock dividends and similar
transactions.
(2) Estimated solely for the purpose of calculating the amount of the
registration fee, and pursuant to Rule 457(c), based on the average of the high
and low sales prices of the Common Stock, as reported on the Nasdaq SmallCap
Market on September 5, 2000.
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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, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT SHALL
BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION
8(A), MAY DETERMINE.
===============================================================================
<PAGE>
PROSPECTUS
Up to 10,344,166 Shares of Common Stock
Offered by certain Selling Stockholders
TECHSYS, INC.
This is an offering by certain Selling Stockholders, identified in this
prospectus, of up to 10,344,166 shares of Common Stock of TechSys, Inc.
The Selling Stockholders may offer the Shares through public or private
transactions at prevailing market prices, at prices related to such prevailing
market prices or at privately negotiated prices. See "Plan of Distribution" for
a discussion of the methods of sale the Selling Stockholders or their pledgees,
donees, transferees or other successors in interest may use to offer the Shares.
The Company will not receive any proceeds from the sale of the Shares
by the Selling Stockholders. We have indemnified the Selling Stockholders
against certain liabilities, including liabilities under the Securities Act of
1933, as amended. We will bear all expenses in connection with the registration
and sales of the Shares, other than underwriting discounts and selling
commissions and fees and expenses of counsel and other advisers to the Selling
Stockholders.
On September 6, 2000, the last reported sale price of the Common Stock
on the Nasdaq SmallCap Market was $9.31. The Common Stock is traded under the
Nasdaq symbol "TKSS."
See "Risk Factors" beginning on page 3 for a discussion of certain
factors that you should consider before you invest in the Common Stock being
sold with this prospectus.
-------------------------------------------------------------------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is a
criminal offense.
--------------------------------------------------------------------------------
The date of this Prospectus is ________________
<PAGE>
TABLE OF CONTENTS
Where You Can Find More Information about TechSys, Inc......................1
Summary.....................................................................2
Risk Factors................................................................3
General Risk Factors
--------------------
Continued Losses...................................................3
Market Overhang from Outstanding Warrants and Options; Dilution....3
Influence of Principal Stockholders................................3
Health Care Regulations Related to Prior Operations................4
Risks Associated with New Business Strategy
-------------------------------------------
Uncertainty with respect to Risks Relating to
New Business Strategy............................................4
Uncertainty with respect to Potential Business Targets.............4
Additional Financing May be Required...............................4
Risks Associated with Dry-Cleaning Operations
---------------------------------------------
Seasonality........................................................5
Competition........................................................5
Environmental Laws.................................................5
Selling Stockholders........................................................6
Use of Proceeds.............................................................9
Plan of Distribution........................................................9
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION ABOUT
TECHSYS, INC.
We file annual, quarterly and special reports, proxy statements and
other information with the Securities and Exchange Commission. You may read and
copy any of the information on file with the SEC at the SEC's public reference
room at 459 Fifth Street, N.W., Washington, D.C. 20549. Copies of the filed
documents can be obtained by mail from the Public Reference Section of the SEC
at Room 1024, 450 Fifth Street, N.W. Washington, D.C. 20549 at prescribed rates.
You may call the SEC at 1-800-SEC-0330 for further information on the public
reference room. Filed documents are also available to the public at the SEC's
Web site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
an important part of this prospectus, and information that we file later with
the SEC will automatically update and supersede this information. We incorporate
by reference the documents listed below and any future filings made with the SEC
under Sections 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934
until all of the shares offered are sold.
1. Annual Report on Form 10-KSB for the year ended December 31, 1999 and
the Amendment to Annual Report on Form 10-KSB/A for the year ended
December 31, 1999.
2. Quarterly Reports on Form 10-QSB for the quarters ended March 31, 2000,
as amended, and June 30, 2000.
3. Current Reports on Form 8-K filed on August 24, 2000, September 5,
2000, and September 7, 2000.
4. The Description of the Company's Common Stock contained in Registration
Statement No. 33-78288.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes that statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
You can request, and we will send to you, without charge, copies of
documents that are incorporated by reference in this Prospectus but which are
not delivered to you (other than exhibits to such documents which are not
specifically incorporated by reference). You may request these copies by writing
or telephoning the Company at: TechSys, Inc., 44 Aspen Drive, Livingston, New
Jersey 07039, Attention: Mark N. Raab, telephone number (973) 422-1666.
You should rely on the information incorporated by reference or
provided in this Prospectus or any prospectus supplement. We have not authorized
anyone else to provide you with different information.
<PAGE>
SUMMARY
The following summary is qualified in its entirety by the detailed
information and consolidated financial statements included elsewhere or
incorporated by reference in this Prospectus.
The Company
-----------
In July 2000, the Company implemented a business strategy that focuses
on investing in and acquiring information technology businesses based in
emerging markets with particular emphasis on India. We intend to focus on the
information technology sector, with an emphasis on software services and
internet-based call centers.
The Company, through a wholly-owned subsidiary, provides dry-cleaning
services primarily to the hospitality industry in the Phoenix, Arizona area. We
operate a single plant and drop store and provide dry cleaning services to
certain hotels.
As part of our sale of substantially all of our dialysis-related assets
to IHS of New York, Inc., we entered into a consulting agreement with IHS. We
provide certain consulting services to IHS in consideration of an aggregate of
$1,000,000 payable by IHS to us over the term of the agreement, which expires in
October 2000.
The Offering
------------
This offering of up to 10,344,166 shares of Common Stock of TechSys,
Inc. is by the Selling Stockholders. The shares offered consist of the
following:
(1) 7,000,000 shares which could be issued by one Selling
Stockholder. We issued 200,000 Shares of Common Stock and a
warrant to purchase up to 6,800,000 shares of Common Stock to
one Selling Stockholder in a private placement. See "Selling
Stockholders."
(2) 1,527,500 shares owned by one Selling Stockholder. One Selling
Stockholder, TechTron, Inc., beneficially owns approximately
39% of the outstanding Common Stock. Mr. Alvin S. Trenk, Mr.
Steven L. Trenk, and Dr. Martin G. Jacobs, officers and
directors of the Company, are each officers, directors and
principal stockholders of this Selling Stockholder. See
"Selling Stockholders."
(3) 66,666 shares owned by one Selling Stockholder. We issued
66,666 shares of Common Stock to one Selling Stockholder in a
private placement. See "Selling Stockholder."
(4) 1,750,000 Shares that we may issue to several Selling
Stockholders upon exercise of warrants and options. We issued
warrants and options to purchase up to an aggregate of
1,750,000 shares of Common Stock to thirteen Selling
Stockholders for various reasons. Included in these
convertible securities are warrants to purchase an aggregate
of 1,350,000 shares of Common Stock which we issued to Mr.
Alvin S. Trenk, Mr. Steven L. Trenk, and Dr. Martin G. Jacobs,
officers and directors of the Company, as an additional
incentive for these Selling Stockholders to help the Company
complete transactions in the technology sector. Included in
these convertible securities are warrants we issued to ten
Selling Stockholders for consulting services provided to the
Company. The exercise prices of the warrants and options range
from $1.15625 to $3.50. See "Selling Stockholders."
<PAGE>
RISK FACTORS
Before you invest in our Common Stock, you should be aware that there
are various risks, including those described below. You should carefully
consider these risk factors together with all of the other information included
in this registration statement before you decide to purchase shares of our
Common Stock.
Forward-Looking Information
---------------------------
Some of the information in this registration statement contains
forward-looking statements. You can identify these forward-looking statements
with words like "believe," "expect," "may," "will," "should," "anticipate,"
"estimate," "continue," "goal" and other similar words. These statements discuss
future expectations, contain projections of results of operations or of
financial condition or state other "forward-looking" information. When you
consider these forward-looking statements, you should keep in mind the risk
factors and other cautionary statements in this registration statement. The risk
factors and other uncertainties in this registration statement could cause
actual results to differ materially from those contained in any forward-looking
statement. We do not undertake to publicly update or revise any forward-looking
statements.
GENERAL RISK FACTORS
Continued Losses
----------------
In 1997, we recognized net income from operations of $1,324,229, or
$.41 per share. This income was directly related to the gain on the sale of our
dialysis-related operations in October 1997. Since October 1997 we have operated
at a loss. We had net losses of $781,988, or ($.24) per share, and $2,883,558,
or ($.88) per share, in the fiscal years ended December 31, 1998 and 1999,
respectively. For the six months ended June 30, 2000, we recognized a net loss
from operations of $1,299,947, or ($.38) per share, and had an accumulated
deficit of $4,182,516. There can be no assurance that we will achieve
profitability in the future.
Market Overhang from Outstanding Warrants and Options; Dilution
---------------------------------------------------------------
The Company currently has outstanding 10,066,100 options and warrants
to purchase our Common Stock. Exercise of these options or warrants or even the
potential of their exercise may have an adverse effect on the trading price and
market for our Common Stock. To the extent that such stock options or warrants
are exercised, dilution to the interests of our stockholders would occur.
Assuming no other issuance of securities, if all outstanding options and
warrants are exercised the number of shares of outstanding Common Stock would
increase by approximately 258% and significantly dilute the ownership interests
and proportionate voting power of the existing holders of Common Stock.
Influence of Principal Stockholders
-----------------------------------
Assuming no other issuance of, or conversions or exchanges of
securities into, Common Stock, TechTron, Inc. would own approximately 39% of the
outstanding Common Stock. Assuming no other issuance of, or conversions or
exchanges of securities into, Common Stock, Lazar & Co. I.G., LLC would hold
approximately 5% of the outstanding Common Stock. If the Warrant held by Lazar
is exercised in full, and assuming no other issuance of, or conversions or
exchanges of securities into, Common Stock, Lazar would hold approximately 64%
of the outstanding Common Stock. The concentration of a substantial block of the
outstanding shares of Common Stock in the hands of either single investor could
render more difficult an acquisition of the Company which was favored by a
majority of the other stockholders but opposed by the single investor. Through
the voting of such shares and the ability of Lazar to designate two individuals
to serve on the Board of Directors, subject to approval by the stockholders,
Lazar would be in a position to exercise a significant degree of influence over
the management and affairs of the Company.
Health Care Regulations Related to Prior Operations
---------------------------------------------------
The Company's former dialysis operations were subject to extensive
governmental regulation at the federal, state, and local levels. Our past or
present contractual arrangement or business practices might be challenged, which
might have an adverse effect on us.
<PAGE>
RISKS ASSOCIATED WITH NEW BUSINESS STRATEGY
Uncertainty with respect to New Business Strategy
-------------------------------------------------
In July 2000, the Company announced its new business strategy that
focuses on investing in and acquiring information technology businesses based in
emerging markets with particular emphasis on India. The success of this strategy
will depend on our ability to identify and acquire appropriate target
businesses. Our management does not have experience managing businesses in the
information technology sector. There can be no assurance that we will be able to
implement our new business strategy or that this strategy will ultimately be
successful.
Uncertainty with respect to Potential Business Targets
------------------------------------------------------
We have not selected any particular business targets upon which to
concentrate our investment and acquisition efforts. In addition, the structure
of future transactions with future business targets cannot be determined at the
present time. Accordingly, there is no basis for prospective investors to
evaluate the possible merits or risks of the business targets we may ultimately
operate. Although management will endeavor to evaluate the risks inherent in
particular business targets, including the degree of competition characterizing
a particular business target, there can be no assurance that we will properly
ascertain or assess all such risks.
Additional Financing May be Required
------------------------------------
We may be required to seek additional financing in order to consummate
transactions with potential business targets or to fund the operations or growth
of a business target. In the event that we would be required to seek additional
financing, there can be no assurance that such financing would be available on
acceptable terms, or at all. To the extent that additional financing is not
available when needed to consummate a particular transaction, we may be
compelled to restructure the transaction or abandon that particular transaction
and seek an alternative target business candidate, if possible. Our failure to
secure additional financing after consummating a transaction with a business
target could have a material adverse effect on the continued development or
growth of the business target. Any future financings that involve the sale of
our equity securities may result in dilution to the then current stockholders.
<PAGE>
RISKS ASSOCIATED WITH DRY-CLEANING OPERATIONS
Seasonality
-----------
The Company's dry-cleaning operations in the Phoenix, Arizona area are
subject to seasonal fluctuations, with revenues from November through April
being generally higher than for the rest of the year as a result of the cooler
temperature in the region during those months. Our revenues and operating
results have followed, and we anticipate will continue to follow, the general
industry trend for dry-cleaning businesses in the Phoenix, Arizona area.
Competition
-----------
Our dry-cleaning operations face competition from many individual and
franchised cleaners. The cost of entry into the dry-cleaning business is
relatively low and it requires only a low or semi-skilled labor force. While we
remain competitive in the hospitality industry, our drop store operation faces
substantial local competition from smaller and similar sized competitors. There
can be no assurance that we will be able to retain existing retail or hotel
customers or attract and retain new customers. Our failure to attract and retain
customers, especially hotel customers, would have a material adverse effect on
our business and operations.
Environmental Laws
------------------
Our dry-cleaning operations are subject to various state hazardous
waste disposal laws. The dry-cleaning operations use various cleaning chemicals
which are classified as hazardous substances under applicable state and federal
regulations. While we believe all hazardous substances used in our dry-cleaning
operations are handled in accordance with applicable laws, rules and
regulations, our business practices could be challenged, which could have an
adverse effect on us.
<PAGE>
SELLING STOCKHOLDERS
The following table sets forth certain information about the shares of
Common Stock beneficially owned by each of the Selling Stockholders both before
and after the sale of shares offered hereby.
SHARES BENEFICIALLY OWNED
<TABLE>
<CAPTION>
Shares Beneficially Shares Beneficially
Owned Before Shares to Owned After Offering
Name Offering be Offered Number Percentage(1)
---- --------- ---------- -------- ----------
<S> <C> <C> <C> <C>
Lazar & Company I.G., LLC (2) 7,000,000 7,000,000 0 --
TechTron, Inc. (3) 1,527,500 1,527,500 0 --
Alvin S. Trenk (4) 781,500 450,000 331,500 44.22%(3)
Steven L. Trenk (5) 776,000 450,000 326,000 43.83%(3)
Martin G. Jacobs, M.D.(6) 775,000 450,000 325,000 43.81%(3)
Technology Keiretsu, LLC (7) 66,666 66,666 0 --
Ryan, Beck & Co., Inc. (8) 45,000 45,000 0 --
Randy F. Rock (9) 40,000 40,000 0 --
Michael J. Kollender (10) 27,500 27,500 0 --
Josephthal & Co., Inc. (11) 50,000 50,000 0 --
John E. D'Elisa (12) 12,500 12,500 0 --
Mark E. Brefka (12) 12,500 12,500 0 --
Jerald Belofsky (12) 12,500 12,500 0 --
Alliant Technologies, LLC (13) 50,000 50,000 0 --
Holding Capital Management, LLC (14) 100,000 100,000 0 --
The Equity Group, Inc. (15) 50,000 50,000 0 --
----------
TOTAL 10,344,166
----------
</TABLE>
*Represents less than 1% of the total outstanding shares of Common Stock.
(1) Based on a total of 3,903,544 shares of Common Stock outstanding on
September 1, 2000.
(2) Represents (i) 200,000 shares of Common Stock, and (ii) a warrant to
purchase up to 6,800,000 shares of Common Stock exercisable at $3.00
per share, issued to the Selling Stockholder pursuant to a Securities
Purchase Agreement dated June 7, 2000. Pursuant to the Purchase
Agreement, so long as the warrant is outstanding the Selling
Stockholder has the right to include among nominees for each annual
meeting for the election of directors, two directors selected by the
Selling Stockholder. Currently, the Selling Stockholder has not chosen
to exercise this right.
(3) Represents shares of Common Stock held by TechTron, Inc., a principal
shareholder of the Company. Alvin S. Trenk, Steven L. Trenk, and Martin
G. Jacobs, M.D., officers and directors of the Company, are officers,
directors and principal stockholders of TechTron and directly own an
aggregate of approximately 80.69% of the outstanding common stock of
TechTron. Messrs. Trenk and Dr. Jacobs are treated as a group herein
for purposes of determining beneficial ownership.
(4) The Selling Stockholder serves as Chairman of the Board and a director
of the Company. Represents (i) 450,000 shares issuable upon exercise of
a warrant exercisable at $3.00 per share which was issued as an
additional incentive for the Selling Stockholder to help the Company
complete transactions in the technology sector, (ii) 150,000 shares
issuable upon exercise of options exercisable at $1.4375 per share
which were issued under the Company's 1997 Equity Incentive Plan, and
(iii) 150,000 shares issuable upon exercise of options exercisable at
$1.875 which were issued under the 1997 Plan. Does not include 100,000
shares issuable upon exercise of a warrant held by Holding Capital
Management, LLC, an entity in which the Selling Stockholder holds 10%
of the outstanding securities. See footnote 14 below. The Selling
Stockholder may also be considered to beneficially own, and to have
shared investment and voting power with respect to, all shares of
Common Stock owned by TechTron.
(5) The Selling Stockholder serves as President, Chief Operating Officer
and a director of the Company. Represents (i) 450,000 shares issuable
upon exercise of a warrant exercisable at $3.00 per share which was
issued as an additional incentive for the Selling Stockholder to help
the Company complete transactions in the technology sector, (ii)
150,000 shares issuable upon exercise of options exercisable at $1.4375
per share which were issued under the 1997 Plan, (iii) 104,000 shares
issuable upon exercise of options exercisable at $1.875 per share which
were issued under the 1997 Plan, (iv) 46,000 shares issuable upon
exercise of options exercisable at $1.15625 per share which were issued
under the 1997 Plan, (v) 25,000 shares issuable upon exercise of
options exercisable at $1.875 per share which were issued under the
Company's 1994 Long Term Incentive Award Plan, and (vi) 1,000 shares
held in the name of the Selling Stockholder's children. The Selling
Stockholder may also be considered to beneficially own, and to have
shared investment and voting power with respect to, all shares of
Common Stock owned by TechTron.
(6) The Selling Stockholder serves as Corporate Medical Director and a
director of the Company. Represents (i) 450,000 shares issuable upon
exercise of a warrant exercisable at $3.00 per share which was issued
as an additional incentive for the Selling Stockholder to help the
Company complete transactions in the technology sector, (ii) 150,000
shares issuable upon exercise of options exercisable at $1.4375 per
share which were issued under the 1997 Plan, (iii) 101,000 shares
issuable upon exercise of options exercisable at $1.875 per share which
were issued under the 1997 Plan, (iv) 49,000 shares issuable upon
exercise of options exercisable at $1.15625 per share which were issued
under the 1997 Plan, and (v) 25,000 shares issuable upon exercise of
options exercisable at $1.875 per share which were issued under the
1994 Plan. The Selling Stockholder may also be considered to
beneficially own, and to have shared investment and voting power with
respect to, all shares of Common Stock owned by TechTron.
(7) Represents 66,666 shares of Common Stock issued to the Selling
Stockholder pursuant to Purchase Agreement dated August 31, 2000. The
Selling Stockholder is the parent company of Alliant Technologies, LLC.
See footnote 13 below. The Company holds a 2% interest in the Selling
Stockholder.
(8) The Selling Stockholder provided financial consulting services to the
Company. Represents (i) 33,750 shares issuable upon exercise of a
warrant exercisable at $2.625 per share, and (ii) 11,250 shares
issuable upon exercise of a warrant exercisable at $3.50 per share.
(9) The Selling Stockholder serves as an officer of Ryan, Beck & Co., Inc.
and served as an officer of Josephthal & Co., Inc., entities that
provided financial consulting services to the Company. Represents (i)
20,625 shares issuable upon exercise of a warrant exercisable at $2.625
per share, (ii) 12,500 shares issuable upon exercise of a warrant
exercisable at $3.00 per share, and (iii) 6,875 shares issuable upon
exercise of a warrant exercisable at $3.50 per share. The warrants were
issued to the Selling Stockholder in connection with services rendered
by Ryan, Beck and Josephthal to the Company.
(10) The Selling Stockholder serves as an officer of Ryan, Beck and the
warrants were issued to the Selling Stockholder in connection with
financial consulting services rendered by Ryan, Beck to the Company.
Represents (i) 20,625 shares issuable upon exercise of a warrant
exercisable at $2.625 per share, and (ii) 6,875 shares issuable upon
exercise of a warrant exercisable at $3.50 per share.
(11) The Selling Stockholder provided financial consulting services to the
Company. Represents 50,000 shares issuable upon exercise of a warrant
exercisable at $3.00 per share.
(12) Each such Selling Stockholder served as an officer of Josephthal and
the warrants were issued to each Selling Stockholder in connection with
financial consulting services rendered by Josephthal to the Company.
Represents shares issuable upon exercise of warrants exercisable at
$3.00 per share.
(13) The Selling Stockholder provided consulting services to the Company.
Represents shares issuable upon exercise of a warrant exercisable at
$3.00 per share. The Selling Stockholder is a wholly-owned subsidiary
of Technology Keiretsu, LLC. See footnote 7 above.
(14) The Selling Stockholder provided consulting services to the Company.
Represents shares issuable upon exercise of a warrant exercisable at
$2.00 per share. Mr. A. Trenk, Chairman of the Board and a director of
the Company, holds 10% of the outstanding securities of the Selling
Stockholder. See footnote 4 above.
(15) The Selling Stockholder provided consulting services to the Company.
Represents shares issuable upon exercise of a warrant exercisable at
$3.50 per share.
The information in this table was provided to us by the Selling
Stockholders. We agreed to register the Shares for the account of the Selling
Stockholders and have filed with the SEC under the Securities Act a Registration
Statement on Form S-3, of which this Prospectus is a part, covering the resale
of the Shares from time to time.
<PAGE>
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the Shares. We
will, however, receive the exercise prices upon exercise of the warrants and
options if any of these warrants and options are exercised. These proceeds, if
any, will be used for general corporate purposes.
PLAN OF DISTRIBUTION
The Shares offered for resale are not being underwritten, and we will
not receive any proceeds from this offering. The Selling Stockholders (or,
subject to applicable law, their respective pledges, donees, transferees or
other successors in interest) may offer their Shares at various times in one or
more of the following transactions:
o on the Nasdaq SmallCap Market or on such other market on which the
Common Stock may from time to time be trading,
o in the over-the-counter market,
o in negotiated transactions not on an exchange or over-the-counter
market,
o in connection with the exercise, exchange or conversion of derivative
securities of Common Stock issued to the Selling Stockholders by
pledge to secure debts or other obligations,
o in connection with the writing of options on the Shares, short sales
or in hedging transactions, and
o in a combination of any of the above transactions.
The Selling Stockholders also may sell Shares that qualify under Rule 144 of the
Securities Act, where applicable. The Selling Stockholders shall have the sole
and absolute discretion not to accept any purchase offer or make any sale of
Shares if they deem the purchase price to be unsatisfactory at any particular
time.
The Selling Stockholders or their respective pledgees, donees,
transferees or other successors in interest, may also sell the Shares directly
to market makers acting as principals and/or broker-dealers acting as agents for
themselves or their customers. Such broker-dealers may receive compensation in
the form of discounts, concessions or commissions from the Selling Stockholders
and/or the purchasers of Shares for whom such broker-dealers may act as agents
or to whom they sell as principal or both (which compensation as to a particular
broker-dealer might be in excess of customary commissions). Market makers and
block purchasers purchasing the Shares will do so for their own account and at
their own risk. It is possible that a Selling Stockholder will attempt to sell
shares of Common Stock in block transactions to market makers or other
purchasers at a price per share which may be below the then market price. There
can be no assurance that all or any of the Shares offered hereby will be issued
to, or sold by, the Selling Stockholders. The Selling Stockholders and any
brokers, dealers or agents, upon effecting the sale of any of the Shares offered
hereby, may be deemed "underwriters" as that term is defined under the
Securities Act or the Exchange Act, or the rules and regulations thereunder.
The Selling Stockholders, alternatively, may sell all or any part of
the Shares offered hereby through an underwriter. No Selling Stockholder has
entered into any agreement with a prospective underwriter and there is no
assurance that any such agreement will be entered into. If a Selling Stockholder
enters into such an agreement or agreements, the relevant details will be set
forth in a supplement or revisions to this Prospectus.
The Selling Stockholders and any other persons participating in the
sale or distribution of the Shares will be subject to applicable provisions of
the Exchange Act and the rules and regulations thereunder, including, without
limitation, Regulation M, which provisions may restrict certain activities of,
and limit the timing of purchases and sales of any of the Shares by the Selling
Stockholders or any other such person. Furthermore, under Regulation M, persons
engaged in a distribution of securities are prohibited from simultaneously
engaging in market making and certain other activities with respect to such
securities for a specified period of time prior to the commencement of such
distributions, subject to specified exceptions or exemptions. The foregoing may
affect the marketability of the Shares.
At the time a particular offer of Shares is made by or on behalf of the
Selling Stockholders, a prospectus will be delivered to the extent required by
the Securities Act.
We have agreed with the Selling Stockholders, among other things, (i)
to bear all expenses (other than underwriting discounts and selling commissions,
and fees and expenses of counsel and other advisers to the Selling Stockholders)
in connection with the registration and sale of the Shares being offered by the
Selling Stockholders, and (ii) to indemnify the Selling Stockholders against
certain liabilities, including liabilities under the Securities Act, as an
underwriter or otherwise.
<PAGE>
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
SEC registration fee.......................................... $ 25,261
NASDAQ fees and expenses...................................... $ 15,000
Blue sky fees and expenses.................................... 0
Printing and engraving costs.................................. $ 500
Legal fees.................................................... $ 5,000*
Accounting fees............................................... $ 8,000*
Miscellaneous................................................. $ 1,000*
-------
Total................................................. $ 54,761*
------------------------------------
*Estimate
====================================
Item 15. Indemnification of Officers and Directors
Article 7 of the Company's Certificate of Incorporation provides as
follows:
Pursuant to Section 14A:2-7 of the New Jersey Business Corporation Act,
no director or officer of the Corporation shall be personally liable to the
Corporation or its stockholders for damages or breach of any duty owed to the
Corporation or its stockholders, except that a director or officer shall not be
relieved from liability for any breach of duty based upon an act or omission:
(a) in breach of such person's duty of loyalty to the Corporation or its
stockholders; (b) not in good faith or involving a knowing violation of law; or
(c) resulting in receipt by such person of an improper personal benefit.
Article V, Section 1 of the Company's By-laws entitled
"Indemnification" provides as follows:
The Corporation shall indemnify, and by this by-law does indemnify, all
of its directors, officers, agents and employees serving as such from time to
time after the date of the adoption of this by-law, both during their terms of
office and thereafter, against all reasonable expenses, liabilities, judgments,
fines and amounts paid in settlement actually incurred by them in the
performance of their duties as directors, officers, agents or employees of the
Corporation, to the fullest extent permitted by law. This indemnification may,
in the discretion of the Board of Directors of the Corporation, include advances
of reasonable expenses in advance of final disposition of any action, suit or
proceeding. This indemnification shall not be exclusive of any other rights to
which said directors, officers, agents or employees may be entitled. This
indemnification shall inure to the benefit of the heirs, executors and
administrators of said directors, officers, agents and employees of the
Corporation.
Statutory authority for indemnification of and insurance for the
Company's directors and officers is contained in the New Jersey Business
Corporation Act ("the Act"), in particular, Section 14A:3-5 of the Act, the
material provisions of which may be summarized as follows:
Directors and officers may be indemnified in non-derivative proceedings
against settlements, judgments, fines and penalties and against reasonable
expenses (including counsel fees) where the person acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests of
the corporation and also, in a criminal proceeding, he must have had no
reasonable cause to believe that his conduct was unlawful. In derivative
proceedings such persons may be indemnified against reasonable expenses
(including counsel fees) where the person acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation, but not against settlements, judgments, fines or penalties except
that, without a court determination as to entitlement to indemnity, no indemnity
may be provided to a person who has been adjudged liable to the corporation. In
all cases, the Act provides that indemnification may only be made by the
corporation (unless ordered by a court) only as authorized in a specific case
upon a determination that indemnification is proper in the circumstances because
the person has met the applicable standard of conduct required of the person,
requires a person to be indemnified for reasonable expenses (including counsel
fees) to the extent he has been successful in any proceeding and permits a
corporation to advance expenses upon an undertaking for repayment if it shall be
ultimately determined that the director or officer is not entitled to
indemnification. The indemnification and advancement of expenses provided by or
granted pursuant to the Act is not exclusive of other rights of indemnification
to which a corporate agent may be entitled under a certificate of incorporation,
by-law, agreement, vote of stockholders or otherwise. However, no
indemnification may be made to or on behalf of a director or officer if a final
adjudication adverse to the director or officer establishes that the director's
or officer's acts or omissions were in breach of his duty of loyalty to the
corporation or its stockholders, were not in good faith or involved a knowing
violation of law, or resulted in receipt by the director or officer of an
improper personal benefit. A corporation may purchase and maintain insurance on
behalf of any directors and officers against expenses incurred in any proceeding
and liabilities asserted against them by reason of being or having been a
director of officer, whether or not the corporation would have the power to
indemnify the directors or officers against such expenses and liabilities under
the statute.
Each of the officers and directors of the Company is insured against
certain liabilities which may be incurred as an officer or director of the
Company or its subsidiaries pursuant to a Director and Officer Liability
Insurance Policy issued by TIG Insurance Company. The general effect of the
policy is that if any claims are made against officers or directors of the
Company or its subsidiaries or any of them for a `Wrongful Act' (as defined in
the policy) while acting in their individual or collective capacities as
directors or officers, to the extent the Company has properly indemnified such
officers and directors, the insurer will, subject to the retention amount,
reimburse the Company or its subsidiary for 100% of any `Loss' (as defined in
the policy). In addition, the extent that the Company or its subsidiary has not
indemnified an officer or director, the insurer will pay on behalf of such
officer or director 100% of the Loss. Under the policy, the term `Wrongful Act'
means any actual or alleged breach of duty, error, misstatement, misleading
statement, or omission done or attempted by the directors or officers solely in
their capacities as such. There is no retention amount under the policy for a
Loss for which the insured is not indemnified by the Company for all matters.
The retention amount under the policy for a Loss for which the insured is
indemnified by the Company is $150,000 for securities claims and $100,000 for
all other matters.
Item 16. Exhibits.
The following documents are filed as Exhibits to this Registration
Statement:
Exhibit
Number Exhibit
-------- -------
5 Opinion of Pitney, Hardin, Kipp & Szuch LLP
10.47 Purchase Agreement dated as of June 7, 2000 by and between
Continental Choice Care, Inc. and Lazar & Company I.G., LLC (1)
10.48 Common Stock Purchase Warrant Certificate dated August 21, 2000
issued by Continental Choice Care, Inc. to Lazar & Company I.G.,
LLC (1)
10.51 Common Stock Purchase Warrant Certificate dated August 21, 2000
issued by Continental Choice Care, Inc. to Alvin S. Trenk (1)
10.52 Common Stock Purchase Warrant Certificate dated August 21, 2000,
issued by Continental Choice Care, Inc. to Steven L. Trenk (1)
10.53 Common Stock Purchase Warrant Certificate dated August 21, 2000,
issued Continental Choice Care, Inc. to Martin G. Jacobs, M.D. (1)
10.54 Purchase Agreement dated as of August 31, 2000 by and between
TechSys, Inc. and Technology Keiretsu, LLC (2)
10.55 Warrant to purchase 30,000 shares of Common Stock issued to Ryan,
Beck & Co., Inc.
10.56 Warrant to purchase 3,750 shares of Common Stock issued to Ryan,
Beck & Co., Inc.
10.57 Warrant to purchase 20,625 shares of Common Stock issued to Randy
F. Rock
10.58 Warrant to purchase 20,625 shares of Common Stock issued to Michael
J. Kollender
10.59 Warrant to purchase 10,000 shares of Common Stock issued to Ryan,
Beck & Co., Inc.
10.60 Warrant to purchase 1,250 shares of Common Stock issued to Ryan,
Beck & Co., Inc.
10.61 Warrant to purchase 6,875 shares of Common Stock issued to Randy F.
Rock
10.62 Warrant to purchase 6,875 shares of Common Stock issued to Michael
J. Kollender
10.63 Replacement Warrant Agreement dated October 3, 1996 between the
Company and Josephthal & Co., Inc.
10.64 Replacement Warrant Agreement dated October 3, 1996 between the
Company and Randy F. Rock
10.65 Warrant Agreement dated October 3, 1996 between the Company and
John E. D'Elisa
10.66 Warrant Agreement dated October 3, 1996 between the Company and
Mark E. Brefka
10.67 Warrant Agreement dated October 3, 1996 between the Company and
Jerald Belofskey
10.68 Warrant to purchase 50,000 shares of Common Stock issued to Alliant
Technologies, LLC
10.69 Warrant to purchase 100,000 shares of Common Stock issued to
Holding Capital Management, LLC
10.70 Warrant to purchase 50,000 shares of Common Stock issued to The
Equity Group, Inc.
23(a) Consent of Arthur Andersen LLP
23(b) Consent of Pitney, Hardin, Kipp & Szuch LLP (contained in Exhibit
5) (3)
24 Power of Attorney (contained on the signature page of this
Registration Statement) (3)
---------------------
(1) Incorporated by reference from the Company's Current Report on Form
8-K filed on September 5, 2000.
(2) Incorporated by reference from the Company's Current Report on Form
8-K filed on September 7, 2000.
(3) Included elsewhere in this Registration Statement.
<PAGE>
Item 17. Undertakings.
1. 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:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the Registration
Statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in the Registration Statement;
(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 (i) and (ii) above do not
apply if 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
Securities Exchange Act of 1934 that are incorporated by reference 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.
2. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in 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.
3. 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 provisions discussed in Item 15 of
this Registration Statement, 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 such Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the registrant of expenses incurred or paid by a director,
officer or a 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 such Act and will be governed by the final adjudication of such
issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Livingston, State of New Jersey, on the 8th day
of September, 2000.
TECHSYS, INC.
ALVIN S. TRENK MARK N. RAAB
By: ______________________ By: _______________________
Alvin S. Trenk Mark N. Raab
Chairman of the Board Chief Financial Officer
(Principal Executive Officer) (Principal Accounting Officer)
KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature
appears below hereby constitutes and appoints Alvin S. Trenk and Steven L. Trenk
and each of them, his true and lawful attorneys-in-fact and agents, with full
power of substitution for him and in his name, place and stead in any and all
capacities, to sign any and all amendments to this Registration Statement
(including post-effective amendments), and to file the same with all exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and agents, and each
of them, full power and authority to do and perform each and every act and thing
requisite and necessary to be done in connection therewith, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming what said attorneys-in-fact and agents or their substitutes may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Title Date
----- ----
<S> <C> <C>
By: ALVIN S. TRENK Chairman of the Board September 8, 2000
---------------------------------------- and Director
Alvin S. Trenk
By: STEVEN L. TRENK President, Chief Operating September 8, 2000
---------------------------------------- Officer and Director
Steven L. Trenk
By: Corporate Medical Director
---------------------------------------- and Director
Martin G. Jacobs, M.D.
By: STANLEY B. AMSTERDAM Director September 8, 2000
----------------------------------------
Stanley B. Amsterdam
By: JEFFREY B. MENDELL Director September 8, 2000
----------------------------------------
Jeffrey B. Mendell
</TABLE>
<PAGE>
EXHIBIT INDEX
Exhibit
Number Exhibit
------ -------
5 Opinion of Pitney, Hardin, Kipp & Szuch LLP
10.47 Purchase Agreement dated as of June 7, 2000 by and between
Continental Choice Care, Inc. and Lazar & Company I.G., LLC (1)
10.48 Common Stock Purchase Warrant Certificate dated August 21, 2000
issued by Continental Choice Care, Inc. to Lazar & Company I.G.,
LLC (1)
10.51 Common Stock Purchase Warrant Certificate dated August 21, 2000
issued by Continental Choice Care, Inc. to Alvin S. Trenk (1)
10.52 Common Stock Purchase Warrant Certificate dated August 21, 2000,
issued by Continental Choice Care, Inc. to Steven L. Trenk (1)
10.53 Common Stock Purchase Warrant Certificate dated August 21, 2000,
issued Continental Choice Care, Inc. to Martin G. Jacobs, M.D. (1)
10.54 Purchase Agreement dated as of August 31, 2000 by and between
TechSys, Inc. and Technology Keiretsu, LLC (2)
10.55 Warrant to purchase 30,000 shares of Common Stock issued to Ryan,
Beck & Co., Inc.
10.56 Warrant to purchase 3,750 shares of Common Stock issued to Ryan,
Beck & Co., Inc.
10.57 Warrant to purchase 20,625 shares of Common Stock issued to Randy
F. Rock
10.58 Warrant to purchase 20,625 shares of Common Stock issued to Michael
J. Kollender
10.59 Warrant to purchase 10,000 shares of Common Stock issued to Ryan,
Beck & Co., Inc.
10.60 Warrant to purchase 1,250 shares of Common Stock issued to Ryan,
Beck & Co., Inc.
10.61 Warrant to purchase 6,875 shares of Common Stock issued to Randy F.
Rock
10.62 Warrant to purchase 6,875 shares of Common Stock issued to Michael
J. Kollender
10.63 Replacement Warrant Agreement dated October 3, 1996 between the
Company and Josephthal & Co., Inc.
10.64 Replacement Warrant Agreement dated October 3, 1996 between the
Company and Randy F. Rock
10.65 Warrant Agreement dated October 3, 1996 between the Company and
John E. D'Elisa
10.66 Warrant Agreement dated October 3, 1996 between the Company and
Mark E. Brefka
10.67 Warrant Agreement dated October 3, 1996 between the Company and
Jerald Belofskey
10.68 Warrant to purchase 50,000 shares of Common Stock issued to Alliant
Technologies, LLC
10.69 Warrant to purchase 100,000 shares of Common Stock issued to
Holding Capital Management, LLC
10.70 Warrant to purchase 50,000 shares of Common Stock issued to The
Equity Group, Inc.
23(a) Consent of Arthur Andersen LLP
23(b) Consent of Pitney, Hardin, Kipp & Szuch LLP (contained in Exhibit
5) (3)
24 Power of Attorney (contained on the signature page of this
Registration Statement) (3)
---------------------
(1) Incorporated by reference from the Company's Current Report on Form 8-K
filed on September 5, 2000.
(2) Incorporated by reference from the Company's Current Report on Form 8-K
filed on September 7, 2000.
(3) Included elsewhere in this Registration Statement.
