UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
CHS ELECTRONICS, INC.
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(Name of issuer)
COMMON STOCK, $.001 PAR VALUE
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(Title of class of securities)
12 542 A-20-6
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(CUSIP number)
PAUL BERKOWITZ, ESQ.
GREENBERG, TRAURIG, HOFFMAN,
LIPOFF, ROSEN & QUENTEL, P.A.
1221 BRICKELL AVENUE
MIAMI, FLORIDA 33131
(305) 579-0685
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(Name, address and telephone number of person
authorized to receive notices and communications)
MARCH 21, 1997
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(Date of event which requires filing of this statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following
box.
Check the following box if a fee is being [ ] paid with the statement
[X]. (A fee is
not required only if the reporting person: (1) has a previous statement on file
reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
(Page 1 of 5 Pages)
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CUSIP NO. 12 542 A-20-6 SCHEDULE 13D PAGE 2 OF 5 PAGES
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
CARSTEN FRANK
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)[ ]
(b)[ ]
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1 SEC USE ONLY
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2 SOURCE OF FUNDS
OO
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3 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) or 2(e)
[ ]
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1 CITIZENSHIP OR PLACE OF ORGANIZATION
FEDERAL REPUBLIC OF GERMANY
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NUMBER OF 2 SOLE VOTING POWER 2,200,000
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH
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3 SHARED VOTING POWER
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4 SOLE DISPOSITIVE POWER 2,200,000
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5 SHARED DISPOSITIVE POWER
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6 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,200,000
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7 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES
[ ]
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1 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
14.98%
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2 TYPE OF REPORTING PERSON
IN
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<PAGE>
1 SECURITY AND ISSUER.
This Statement relates to the Common Stock, par value $.001 per share
(the "Common Stock"), of CHS Electronics, Inc. ("CHS Electronics"). The
executive offices of CHS Electronics are located at 2153 N.W. 86th
Avenue, Miami, Florida 33122.
2 IDENTITY AND BACKGROUND.
Frank is Managing Director of Frank & Walter Computer GmbH ("F&W") and
shall be Vice President - Europe of CHS Electronics. The principal
office of F&W is located at Hansestrasse 47, 38112 Braunschweig,
Germany.
Frank has not been convicted in a criminal proceeding in the last five
years.
During the last five years, Frank has not been a party to a civil
proceeding of a judicial or administrative body of competent
jurisdiction which resulted in his being subject to a judgment, decree
or final order enjoining future violations of, or prohibiting or
mandating activities subject to, Federal or state securities laws.
Frank is a citizen of the Federal Republic of Germany.
3 SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
On December 19, 1996, CHS Electronics, Inc. and Frank entered into a
Stock Exchange Agreement (the "Agreement"). The Agreement provided for
the exchange of CHS Electronics Common Stock for shares of Frank &
Walter Computer GmbH ("F&W"), all of which were owned by Frank. On
March 21,1997, the Closing Date, Frank sold and transferred to CHS
Electronics all of the F&W Shares in exchange for 2,200,000 shares of
CHS Common Stock. By virtue of Frank's holdings of F&W Common Stock
immediately prior to the transaction, and pursuant to the Stock
Exchange Agreement, Frank became the beneficial holder of 2,200,000
shares of Common Stock upon the closing of the Agreement.
4 PURPOSE OF TRANSACTION.
Frank has acquired the Common Stock in connection with the
above-described Stock Exchange and not with a view to, or for resale in
connection with, any distribution thereof. Frank has no present
intention of selling, granting any participation in, or otherwise
distributing the Common Stock. Frank does not have any contract,
undertaking, agreement or arrangement with any person to sell,
transfer, or grant participations to such person or to any third
person, with respect to any of its shares of Common Stock.
The shares of the Common Stock of CHS Electronics owned by Frank have
not been registered under the Securities Act of 1933, as amended.
<PAGE>
5 INTEREST IN SECURITIES OF ISSUER.
To the best knowledge of Frank, Frank is the beneficial owner of
2,200,000 shares of Common Stock, or approximately 14.98% of the Common
Stock currently outstanding. Frank has the sole power to vote and
dispose of 2,200,000 of his shares of Common Stock.
6 CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
In connection with the Stock Exchange Agreement, Comtrad Inc. and
Comtrad Holdings, Inc., shareholders of CHS, have agreed to vote their
shares of Common Stock in favor of Frank's election to the Board of
Directors of CHS. CHS intends to nominate Frank for election to the
Board of Directors of CHS and intends to appoint him executive vice
president for Europe.
7 MATERIAL TO BE FILED AS EXHIBITS.
Letter to Mr. Carsten Frank from Comtrad, Inc. and Comtrad Holdings,
Inc. dated December 19, 1996.
2
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
MAY 18, 1997
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(Date)
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Carsten Frank
3
<PAGE>
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
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1 Letter to Mr. Carsten Frank from Comtrad Inc. and Comtrad
Holdings, Inc. dated December 19, 1996.
EXHIBIT 1
SCHEDULE 8.5
December 19, 1996
Mr. Carsten Frank
c/o Dr. H. Busching
Rechtsanwalte Dr. Gebler pp.
Postfach 5560
30055 Hannover
Germany
Re: CHS Electronics, Inc. ("CHS")
Dear Frank:
As you know, CHS intends to acquire all of the outstanding capital
stock in Frank & Walter Computer GmbH ("F&W"), pursuant to a Stock Exchange
Agreement (the "Agreement"), dated as of the date hereof, by and between CHS and
you ("Frank"). The undersigned ("Shareholders") are the prlncipal shareholders
of CHS, and will receive substantial benefits from the acquisition of F&W by CHS
(the "Acquisition").
In order to induce Frank to consummate the Acquisition, each of the
Shareholders hereby agrees that, effective as of the Closing (as defined in the
Agreement), and so long as Frank is the record and beneficial owner of at least
five percent (5%) of the outstanding shares of the Common Stock of CHS:
1. The Shareholders shall vote their shares of the Common Stock of CHS
in favor of your election as a director of CHS, at the first shareholders
meeting held in 1997 (which shall be on or before July 31, 1997), and thereafter
at any other shareholders meeting or meetings held to elect directors (and in
any written consent executed in lieu of such a meeting). Notwithstanding the
foregoing, Shareholders shall not have any obligation to vote their shares to
elect you as a director of CHS if you are the subject of, or meet, any of the
disqualification conditions set forth in 17 C.F.R. ss. 230.262(b)(1)-(5) (or any
successor regulation witH substantially similar requirements).
2. If the Shareholders propose to request CHS to register (a
"Registration") any of their shares of CHS Common Stock (the "Comtrad Shares")
under the Securities Act of 1933 (the "l933 Act"), the Shareholders shall also
request that certain of your shares of CHS Common Stock (the "Frank Shares") be
registered under the 1933 Act at the same time and on the same terms, as
provided herein. The Shareholders shall not permit CHS to register any of the
Comtrad Shares unless Frank at the same time has certain of the Frank Shares
registered as provided herein or has elected not to have Frank Shares registered
pursuant to Section 2(a) below. Any demand by a pledgee of
<PAGE>
Mr. Carsten Frank
December 19, 1996
Page 2
the Shareholders to register Comtrad Shares shall be deemed a request
by the Shareholders for purposes of this Agreement.
(a) The Shareholders shall provide Frank advance written
notice ("Registration Notice") with a copy to Frank's counsel (Dieter A.
Schmitz, Baker & McKenzie, 130 East Randolph Drive, Suite 3500, Chicago, IL
60601, telefax: 312/861-2899) of any proposed Registration of the Comtrad
Shares, which notice shall state the number of Comtrad Shares to be registered
and the other terms of the offering. Frank shall have a period of 20 days after
receipt of Comtrad's Registration Notice to elect to participate in the
Registration. Such election shall be exercised by written notice to the
Shareholders ("Election Notice"), which notice shall: (i) specify the number of
Frank Shares which Frank elects to register, and (ii) be delivered to the
Shareholders within such 20 day period. Frank's failure to deliver such notice
shall be deemed an election to not participate in the Registration.
(b) The parties shall have a period of 7 days after the
Shareholders' receipt of Frank's Election Notice to agree on the number of
shares to be registered by each party. If the parties fail to agree, then: (i)
the Shareholders shall have the right to register the number of shares shown in
the Registration Notice; and (ii) Frank shall have the right to register a
portion of the Frank Shares then owned by Frank equal to: (1) the number of
Comtrad Shares to be registered in the Registration, divided by (2) the
aggregate number of Comtrad Shares then owned by the Shareholders.
(c) If the number of shares determined pursuant to subsection
(b) above must be reduced, because of market conditions, decision of the
underwriter, or any other reason, such reduction shall be applied to the parties
on a pro-rata basis, based on the number of shares each party originally
proposed to include in the Registration.
(d) Nothing contained herein shall require either of the
parties hereto to register or sell any of their CHS Common Stock at any time. It
shall be a condition precedent to the obligations of the Shareholders to take
any action pursuant to this Agreement with respect to the Frank Shares that
Frank shall furnish to CHS such information regarding himself, the Frank Shares
and the intended method of disposition of such securities as shall be required
to effect the registration of such securities.
(e) Frank shall not any right to obtain or seek an injunction
restraining or otherwise delaying any registration by CHS as the result of any
controversy that might arise with respect to the interpretation or
implementation of this Agreement; provided, however, that the provisions of this
subsection (e) shall not prohibit Frank from (i) obtaining an injunction
ordering the Shareholders to cause CHS to register the Frank Shares as provided
herein, (ii) obtaining an injunction prohibiting the Shareholders from
registering Comtrad Shares until they have complied with their obligations
hereunder, or (iii) obtaining money damages against Shareholders arising from a
default by Shareholders hereunder.
<PAGE>
Mr. Carsten Frank
December 19, 1996
Page 3
3. Notwithstanding anything to the contrary contained in Section 2
above, Frank shall have no right to request or seek registration of any Frank
Shares which are subject to resale restrictions under Section 9.5.2 of the
Agreement.
4. Frank's rights under this Agreement may not be assigned. This letter
shall (i) be governed and construed in accordance with the laws of Florida; and
(ii) be binding and effective for all purposes when a signed copy has been
transmitted to you by telecopier.
Very truly yours,
COMTRAD, INC.
By:
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Title:
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COMTRAD HOLDINGS, INC.
By:
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Title:
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ACCEPTED AND AGREED:
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Carsten Frank
