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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 23, 1999
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
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THE SOURCE INFORMATION MANAGEMENT COMPANY
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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MISSOURI 43-1710906
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
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11644 LILBURN PARK ROAD, ST. LOUIS, MISSOURI 63146
(314) 995-9040
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
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W. BRIAN RODGERS
SECRETARY AND CHIEF FINANCIAL OFFICER
THE SOURCE INFORMATION MANAGEMENT COMPANY
11644 LILBURN PARK ROAD, ST. LOUIS, MISSOURI 63146
(314) 995-9040
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
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WITH COPY TO:
JOHN L. GILLIS, JR., ESQ.
ARMSTRONG TEASDALE LLP
ONE METROPOLITAN SQUARE, SUITE 2600
ST. LOUIS, MISSOURI 63102-2740
(314) 621-5070
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Approximate date of commencement of proposed sale to the public: As soon as
practicable after this Registration Statement becomes effective.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, 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, check the following box and
list the Securities Act registration statement number of earlier effective
registration statement for the same offering. [ ]
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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. [ ]
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If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
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CALCULATION OF REGISTRATION FEE
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NUMBER OF PROPOSED PROPOSED
SHARES TO BE MAXIMUM OFFERING MAXIMUM AGGREGATE AMOUNT OF
TITLE OF SHARES TO BE REGISTERED REGISTERED PRICE PER SHARE(1) OFFERING PRICE(1) REGISTRATION FEE
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Common Stock, par value $0.01 per
share............................ 200,000 $14.50 $2,900,000.00 $807.00
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(1) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457 under the Securities Act of 1933.
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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 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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The information contained in this prospectus is not complete and may be
changed. We may not sell these securities until the registration statement
filed with the Securities and Exchange commission is effective. This
prospectus is not an offer to sell these securities and it is not the
solicitation of an offer to buy these securities in any state where the
offer or sale is not permitted.
SUBJECT TO COMPLETION
JULY 23, 1999
200,000 SHARES
THE SOURCE INFORMATION MANAGEMENT COMPANY
COMMON STOCK
The selling stockholder named in this prospectus under "Principal and Selling
Stockholders" is offering up to 200,000 shares of common stock with this
prospectus. The selling stockholder has the right to acquire the shares from The
Source upon exercise of a Warrant at a purchase price of $4.80 per share. The
Warrant expires on October 7, 2000. The Source will not receive any proceeds
from the sale of shares by the selling stockholder.
The selling stockholder may offer the shares of common stock through public or
private transactions, on the Nasdaq National Market at prevailing market prices,
or at privately negotiated prices. The Source will pay all costs and expenses
incurred in connection with the registration of the resale of the shares of
common stock under the Securities Act. The selling stockholder will pay the
costs associated with any sales of the shares of common stock, including any
discounts, commissions and applicable transfer taxes.
Our common stock is listed on the Nasdaq National Market under the symbol
"SORC." On July 20, 1999, the last reported sale price of the common stock on
the Nasdaq was $14.50 per share.
INVESTING IN THE COMMON STOCK INVOLVES CERTAIN RISKS. SEE "RISK FACTORS"
BEGINNING ON PAGE 6.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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The date of this prospectus is , 1999.
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TABLE OF CONTENTS
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PAGE
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Prospectus Summary.......................................... 3
Risk Factors................................................ 6
Forward-Looking Statements.................................. 10
Use of Proceeds............................................. 10
Selling Stockholder......................................... 10
Plan of Distribution........................................ 11
Legal Matters............................................... 12
Experts..................................................... 12
Where You Can Find More Information......................... 13
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As used in this prospectus, the terms "we," "us," "our" and "The Source"
mean The Source Information Management Company and its subsidiaries (unless the
context indicates a different meaning) and the term "common stock" means our
common stock, $0.01 par value per share. References to "U.S. Marketing" mean
U.S. Marketing Services, Inc. and its affiliates, Brand Marketing Corporation,
TCE Corporation and The Vail Companies, which we acquired in January 1999.
References to "MYCO" mean MYCO, Inc. and RY, Inc., which we acquired in February
1999.
Our principal executive offices are located at 11644 Lilburn Park Road, St.
Louis, Missouri 63146. Our telephone number is (314) 995-9040.
In October 1997, we effected a 1-for-1.21 reverse stock split. All common
share and per share numbers in this prospectus have been restated to reflect the
split.
Our fiscal year begins on February 1st and ends on January 31st. For
example, fiscal 1999 began on February 1, 1998 and ended on January 31, 1999.
Information stated on a pro forma basis incorporated by reference in this
prospectus includes the results of operations of U.S. Marketing and MYCO as if
the acquisitions had been consummated February 1, 1997.
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PROSPECTUS SUMMARY
This summary highlights information contained in other parts of this
prospectus. It is not complete and may not contain all of the information that
you should consider before investing in the shares. You should read the entire
prospectus carefully.
THE COMPANY
We are a leading provider of information and management services for retail
magazine sales to U.S. and Canadian retailers and magazine publishers. We are
also a leading manufacturer of display racks used by retailers at checkout
counters.
Through our information services, we provide sales figures and product
placement and other related information in various formats, including print,
CD-ROM and over the Internet. This information helps users to formulate
marketing, distribution and advertising plans and to react more quickly to
changing market conditions. Our information services cover approximately 7,000
magazine titles and are provided to over 1,000 retail chains with approximately
100,000 stores and 500,000 checkout counters. We believe we maintain the most
comprehensive and up to date information database available for retail magazine
sales and magazine placement at checkout counters. We have expanded upon our
experience with retail magazine sales to provide similar information and
services to confectioners and vendors of general merchandise sold at checkout
counters.
Through our management services, we help retailers to increase sales and
incentive payment revenues by reconfiguring and designing front-end display
racks, supervising fixture installation, selecting products and negotiating,
billing and collecting incentive payments from vendors. Historically, as part of
our services, we arranged for the manufacture of display racks for many of our
customers. Since January 1999, we acquired four display rack manufacturers.
Manufacturing display racks in our own facilities allows us to be a full-service
provider of management services for the checkout area, or "front-end," of a
customer's store. We also can integrate the design and manufacturing processes
with our clients' merchandising strategies and better manage the timing of
display rack delivery.
We believe that we are well positioned to use our existing relationships
with retailers and vendors to cross-sell our information and management services
and display rack manufacturing capability.
Industry Overview. A substantial portion of the products sold in retail
stores are bought on impulse. It is therefore important to vendors that their
products be on prominent display in those areas of a store where they will be
seen by the largest number of shoppers. There are usually two such areas in a
store. One is a dedicated area called a mainline display; the other is the
checkout area which is sometimes referred to as the "front-end." Products suited
to front-end display include magazines, confections and certain general
merchandise such as razor blades, film and batteries.
Vendors of front-end products compete for favorable spaces on display
racks, which we refer to as "pockets." Some vendors make incentive payments to
retailers for favorable pocket locations. These payments may include up-front
fees to have display racks configured to provide for a vendor's desired pocket
placement, recurring pocket rental fees based on the size and location of a
product's pocket or rebate payments based on a product's sales volume.
Timely delivery of information about retailer activity at the front-end,
including timing of reconfigurations, changes in display position or the
discontinuance of a vendor's products, is important to front-end vendors. Timely
delivery of information about price changes, special promotions, new product
introductions and other vendor plans is important to retailers. We believe that
there is an increasing demand on the part of front-end vendors for more frequent
and detailed information on sales and other front-end activity.
Services. We currently provide the following services:
- - In our CLAIM SUBMISSION PROGRAM, we assist U.S. and Canadian retailers to
accurately monitor, document, claim and collect incentive payments and pocket
rental fees from magazine publishers. As part of this service, we
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prepare claim forms and submit them for payment, charging the retailer a
negotiated percentage of the amount collected.
- - As an extension of our Claim Submission Program, we have established our
ADVANCE PAY PROGRAM. Under this program, we pay to participating retailers a
negotiated fixed percentage of the total quarterly incentive and pocket
rental payments otherwise due the retailer. Generally, these payments are
made before we are paid by the publishers.
- - Through our Periodical Information Network (PIN), we market our database of
magazine-related industry information that we gathered through our Claim
Submission Program to magazine publishers. This information assists them in
formulating their publishing and distribution strategies. We believe that PIN
is the most extensive database available for single copy retail magazine
sales information.
- - We have developed our Interactive Communications Network (ICN) website in
response to the business communications opportunities presented by the
Internet. ICN enables magazine publishers to access information regarding
pricing, new titles, discontinued titles and display rack configuration
changes on a chain-by-chain basis. Publishers also can use ICN to promote
special incentives and advertise new publications and upcoming covers.
Retailers can use ICN to order new magazine titles and take advantage of
promotions by publishers. They also can download constantly changing
information regarding prices, new titles and the resulting changes to Uniform
Product Codes. We intend to adapt ICN for confections and general
merchandise. We receive annual fees from each publisher that subscribes to
ICN. We also receive fees from publishers for advertising, promotions and
special programs on ICN.
- - Through FRONT-END MANAGEMENT, we help retailers to increase sales and
incentive payment revenues by reconfiguring and designing front-end display
racks, supervising fixture installation, selecting products, negotiating,
billing and collecting incentive payments from vendors.
- - Through FRONT-END AND POINT-OF-PURCHASE DISPLAY RACK MANUFACTURING, we
design, manufacture and deliver custom front-end and point-of-purchase
displays for both retail store chains and product manufacturers. We believe
that manufacturing display racks strengthens our ability to provide front-end
management services, and increases our access to information about magazines
and other products from retail checkout areas, which enhances our ability to
provide PIN and ICN.
OUR STRATEGY
Our objective is to strengthen our position as the leading provider of
sales figures and product placement and other related information for magazines
sold in retail stores. We also seek to become the leading provider of similar
information for confections and general merchandise sold at checkout counters,
as well as of other front-end services to retailers and vendors that help to
increase sales from the retail checkout area. Our strategies for achieving our
objectives include the following:
- Developing the capability to provide magazine sale information more
frequently and on a store-by-store basis;
- Increasing the amount of information we collect with respect to
magazines and other front-end products, including confections, razor
blades, film and batteries;
- Expanding Internet distribution and data;
- Expanding our Advance Pay Program;
- Expanding and cross-selling our display rack manufacturing business; and
- Pursuing strategic acquisitions.
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THE OFFERING
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Shares offered by the selling stockholder............ 200,000 shares
Shares outstanding after the offering................ 16,868,279 shares(1)
Use of proceeds...................................... We will not receive any proceeds from the sale
of shares by the selling stockholder.
Nasdaq National Market symbol........................ SORC
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(1) Does not include (i) 1,746,205 shares reserved for issuance under our
existing stock option plans, (ii) 753,750 shares subject to outstanding
warrants and (iii) 635,547 shares which may be issued as additional
consideration for our recent acquisitions, as determined on July 13, 1999.
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RISK FACTORS
You should carefully consider the following factors and other information
in this prospectus before deciding to invest in the shares.
WE DEPEND ON THE MARKETING AND DISTRIBUTION STRATEGIES OF PUBLISHERS
We derive a significant portion of our revenues from our magazine claims
submission program and our Advance Pay Program. Magazine publishers are not
under long-term contractual obligations to provide incentive programs. In
addition, some magazine publishers have distributed selected titles at
discounted prices instead of providing incentive payments. Although we do not
believe that any significant magazine publishers are doing so now, they may do
so in the future. In addition, magazine publishers may otherwise discontinue or
significantly modify their incentive programs. If any of the foregoing were to
occur, it could materially harm our business, financial condition and future
results.
WE RELY ON ACCESS TO RETAIL STORE INFORMATION
Our PIN and ICN programs depend on our access to retail store information,
particularly from the checkout area. If our access to information were reduced,
the usefulness of PIN, ICN and our future information programs could be
diminished. Among other reasons, our access to information could be reduced if
publishers discontinue or modify their incentive payment programs. If our access
to information were reduced, it could materially harm our business, financial
condition and future results.
WE FACE RISKS ASSOCIATED WITH OUR ADVANCE PAY PROGRAM
Recent increases in our revenue and profitability have been due in part to
our Advance Pay Program. Under the Advance Pay Program, we usually assume the
risk otherwise borne by the retailer client that vendors will refuse or be
unable to pay incentive payments. Based on our experience with magazine
incentive payment claims, we maintain a reserve of 2% of all claims submitted to
cover these occurrences. These reserves may be inadequate. Furthermore, we
finance our Advance Pay Program in part through borrowings under our credit
facility. The availability of funds under our credit facility is, among other
things, conditioned on the maintenance of certain financial ratios. There can be
no assurance that we will be able to satisfy these conditions or that we
otherwise will be able to borrow sufficient funds under our credit facility. If
our reserve is inadequate or we are unable to finance our Advance Pay Program,
our business, financial condition and future results could be materially harmed.
OUR GROWTH STRATEGY PRESENTS RISKS
An important part of our growth strategy is to substantially increase our
revenues from information based services, particularly ICN, and from front-end
management services. Although these categories of services use both the
expertise that we have gained from providing other services and our
relationships with retailers and vendors, we may not be able to successfully
continue to implement these parts of our growth strategy. Factors which could
limit our ability to increase our revenues from these services include, among
others, insufficient demand from retailers and vendors and competition. If we
fail to implement these or other portions of our growth strategy, it could
materially harm our business and future results.
Additionally, an important part of our growth strategy is to provide U.S.
and Canadian magazine sales information more frequently and on a store-by-store
basis. Currently, we are able to obtain weekly store-by-store data only in
Canada. There can be no assurance that we will be able to obtain such specific
information for additional stores or that the information that we currently are
able to obtain will be available to us in the future. If we are unable to obtain
such magazine sales information, more frequently and on a store-by-store basis,
it could materially harm our business and future results.
WE MAY EXPERIENCE INCREASED COMPETITION
We face significant competition for many of our services. For example, we
have a substantial number of direct competitors for our claims submission
program, all of which are closely-held private companies. We also compete with
five other manufacturers for our front-end display rack manufacturing business.
There also are a substan-
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tial number of competitors for our point-of-purchase rack business, many of
which are national in scope. Any of these competitors could also compete for our
front-end display rack business.
In addition, some of our information and management services may be
performed directly by our retailer customers or by vendors, distributors or
other information service providers. Other organizations, including ACNielsen,
Information Resources and Audit Bureau of Circulations, also collect sales data
from retail stores. While none of these organizations currently compete with us,
any one of them could do so. If any of them were to compete with us, given their
experience in collecting information and their industry reputation, they could
be a formidable competitor.
Our competitors also may introduce services that are perceived by our
clients to be more attractive than those we provide. In addition, many of our
current and possible competitors have substantially greater financial resources
than we do.
Competitive pressures may result in a decrease in the number of clients we
serve and a decrease in our revenues. Either of these could materially harm our
business, financial condition and future results.
WE FACE RISKS RELATED TO ACQUISITIONS
Making additional strategic acquisitions is a part of our strategy. Our
ability to make acquisitions will depend upon our identifying attractive
acquisition candidates and, if necessary, obtaining financing on satisfactory
terms. Acquisitions, including those that we have already made, can present a
number of challenges. These include the following:
- potential distraction to management;
- integrating the acquired business's financial, computer, payroll and
other systems into our own;
- implementing additional controls and information systems appropriate to
a growing company;
- unanticipated liabilities or contingencies from the acquired company;
and
- reduced earnings due to increased goodwill amortization, increased
interest costs and costs related to integration.
Furthermore, we may pay for acquisitions using our common stock, which
would dilute our stockholders' ownership interests.
If we are unsuccessful in meeting the challenges arising out of our
acquisitions, our business, financial condition and future results could be
materially harmed.
WE MAY FACE RISKS IN CONNECTION WITH OUR NEWLY-ACQUIRED MANUFACTURING OPERATIONS
We have recently acquired four display rack manufacturers. We have no prior
experience in operating manufacturing facilities and therefore must rely on the
experience and management abilities of their management teams and recently hired
employees to oversee these operations. If we are not able to successfully
integrate these facilities into our operations or operate these facilities
profitably, it could result in material harm to our business, financial
condition and future results.
WE HAVE A CONCENTRATED CLIENT BASE
During fiscal 1999, three customers accounted for approximately 38% of
revenues. One of these customers, Food Lion, Inc., accounted for approximately
27% of revenues. Substantially all of our services are performed under
short-term contracts, thus permitting our clients to obtain services from other
providers without further obligation to us. If we experience a significant
reduction in business from our clients it may result in material harm to our
business, financial condition and future results.
WE DEPEND ON KEY PERSONNEL
We depend upon the services of our senior management team, the loss of
certain members of which could adversely affect our business and the
implementation of our growth strategy. This in turn could materially harm our
financial condition and future results. Although we have employment agreements
with certain of our senior officers, the services of these individuals or other
members of our operating or senior management may not continue to be available
us.
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WE FACE RISKS ASSOCIATED WITH THE INTERNET
Our ICN service involves the transmission of information over the Internet.
Our ability to provide this service therefore depends in part on the reliability
of Internet service providers, which from time to time have operational problems
and experience service outages. In addition, ICN may be vulnerable to
unauthorized access, computer viruses and other disruptive problems, including
security breaches by computer hackers, despite our implementation of security
measures. Furthermore, the widespread commercial use of the Internet is a
relatively new development and critical issues regarding the stability of the
Internet's infrastructure remain unresolved. The rapid rise in the number of
Internet users continue to place increasing strains on the Internet's
communication and transmission infrastructures. Over time, this could lead to
significant reductions in transmission speeds and reliability of the Internet,
which could reduce Internet usage by businesses. Any of the foregoing could
impair customer satisfaction with ICN, which could lead to a loss of customers
for this service.
WE HAVE LIMITED PROTECTION OF OUR PROPRIETARY TECHNOLOGY
We rely on a combination of copyright, trade secret and trademark laws to
protect our proprietary rights. We are also in the process of seeking patent
protection for aspects of our ICN, PIN and SourcePro innovations. Existing
copyright laws afford only limited protection. In addition, we may not be
successful in obtaining the patent protection we seek. If we do achieve patent
protection, the patents may not be broad enough to provide meaningful protection
to our services. Also, it may be possible for third parties to copy our services
or to reverse engineer or otherwise obtain and use information that we regard as
proprietary. If third parties are able to use information that we regard as
proprietary, our business, financial condition and future results could suffer
material harm.
WE FACE RISKS CONCERNING YEAR 2000 ISSUES
Many of the services we provide are dependent on computer technology,
especially those that are information-based. Because we depend on information
from vendors and retailers in order to provide our information-based services
such as PIN and ICN, we also are dependent upon the information technology
systems of these parties, as well as those of distributors. We are also
dependent upon infrastructure providers (such as electricity and
telecommunications providers) being Year 2000 compliant, since, among other
things, we cannot transfer and receive information unless their systems are
functional. We believe that our greatest risk due to internal or external
sources not being Year 2000 compliant would be our inability to meet client
deadlines, perhaps for a substantial period of time. However, the actual risk
could be greater. In addition, our information collection capabilities could be
impaired, which could adversely affect the quality, reliability and timeliness
of the information we collect, as well as demand for our information-based
services.
We are in the process of testing all of our systems to determine whether or
not they are Year 2000 compliant. Certain of our manufacturing operations are
non-compliant. Although we have made inquiries regarding Year 2000 compliance of
selected vendors and retailers with whom we have extensive relationships, we are
unable to reliably determine whether most vendors, retailers or infrastructure
providers are or will be Year 2000 compliant on a timely basis. We currently
have no contingency plan in place for Year 2000 issues.
External or internal Year 2000 compliance issues, may materially harm our
business, financial condition and future results. In addition, although we do
not expect our Year 2000 compliance costs to be material, they may be.
WE HAVE LIMITATIONS ON A CHANGE OF CONTROL
Our Articles of Incorporation and By-Laws contain provisions that could
reduce the likelihood of a change of control or acquisition of The Source. This
could limit your ability to sell your shares at a premium or otherwise affect
the price of our common stock. These provisions:
- provide for a classified Board of Directors;
- permit the Board to issue up to 2 million shares of preferred stock and
to determine the price, rights, preferences, privileges and restrictions
of that preferred stock;
- permit the Board to issue up to 40 million shares of common stock;
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- permit the Board to increase its own size and fill the resulting
vacancies;
- limit the removal of directors by the stockholders to removal for cause;
- limit the persons who may call special meetings of stockholders; and
- establish advance notice requirements for nominations for election to
the Board of Directors or for proposing matters that can be acted on by
stockholders at stockholder meetings.
SALES OF OUR SHARES ELIGIBLE FOR FUTURE SALE COULD ADVERSELY AFFECT OUR STOCK
PRICE
The market price of our common stock could drop due to sales of a large
number of shares of our common stock or the perception that such sales could
occur. These factors could also make it more difficult to raise funds through
future offerings of common stock.
After this offering, 16,868,279 shares of our common stock will be
outstanding. Of these shares, the 200,000 shares sold in this offering are
expected to be freely tradeable without restrictions under the Securities Act,
and 13,628,661 shares will otherwise be eligible for sale in the public market.
An additional 3,239,618 shares are "restricted" within the meaning of Rule 144
under the Securities Act of 1933 and may not be sold in the absence of
registration under the Securities Act or an exemption therefrom. Of these
restricted shares, 2,655,000 have registration rights under certain
circumstances. By exercising registration rights, holders of these shares would
be able to sell them in the public market. Also, 2,499,935 shares of our common
stock are issuable upon the exercise of options and warrants. Although a
substantial number of our options and warrants currently are subject to vesting
requirements, upon issuance, 1,386,205 of these shares are expected to be
eligible for sale in the public market and holders of 200,000 of these shares
will have registration rights. The remainder will be restricted securities under
Rule 144.
Certain of our significant stockholders have entered into lock-up
agreements pursuant to which they have agreed not to offer or sell any shares of
common stock for a period of 180 days from June 30, 1999 without the prior
written consent of CIBC World Markets Corp. CIBC World Markets Corp. may, at any
time and without notice, waive the terms of these lock-up agreements.
THERE MAY BE VOLATILITY IN OUR STOCK PRICE
The market price of our common stock has fluctuated significantly. The
market price of our common stock could be subject to significant fluctuations in
the future based on factors such as announcements of new services, additions or
departures of key personnel, quarterly fluctuations in our financial results,
changes in analysts' estimates of our financial performance, general conditions
in our industry and conditions in the financial markets. In addition, the stock
market in general has experienced extreme price and volume fluctuations, and the
market price of our common stock could be subject to these fluctuations for
reasons unrelated to our operating performance and condition.
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FORWARD-LOOKING STATEMENTS
Some of the information in this prospectus contains forward-looking
statements within the meaning of the federal securities laws. These statements
may be found under "Prospectus Summary" and "Risk Factors." Forward-looking
statements typically are identified by use of terms such as "may," "will,"
"expect," "anticipate," "estimate" and similar words, although some
forward-looking statements are expressed differently. You should be aware that
our actual results could differ materially from those contained in
forward-looking statements due to a number of factors, including:
- Our dependence on the marketing and distribution strategies of
publishers and other vendors;
- Our ability to access checkout area information;
- Risks associated with our Advance Pay Program, including problems
collecting incentive payments from publishers;
- Demand for our display racks;
- Our ability to successfully implement our growth strategy;
- Competition;
- Our ability to effectively manage our expansion; and
- General economic and business conditions nationally, in our markets and
in our industry.
You should also consider carefully the statements under "Risk Factors" and
other sections of this prospectus, which address additional factors that could
cause our actual results to differ from those set forth in the forward-looking
statements.
USE OF PROCEEDS
We will not receive any of the proceeds from the sales of shares by the
selling stockholder. We will receive $960,000 from the selling stockholder upon
the exercise of the warrants, which we will use for working capital. We will pay
all costs and expenses incurred in connection with the registration of the
resale of the shares of common stock under the Securities Act. The selling
stockholder will pay the costs associated with any sales of the shares of common
stock, including any discounts, commissions and applicable transfer taxes.
SELLING STOCKHOLDER
The following table sets forth certain information as of July 13, 1999
regarding the beneficial ownership of common stock by the selling stockholder
and as adjusted to give effect to the sale of the shares offered hereby. The
shares are being registered to permit public secondary trading of the shares,
and the selling stockholder may offer the shares for resale from time to time.
The selling stockholder is under no obligation to sell all or any portion of the
shares of common stock offered hereby. See "Plan of Distribution."
All of the shares being offered by the selling stockholder may be acquired
from The Source at a gross purchase price per share of $4.80, on or before
October 7, 2002 upon exercise of a warrant to purchase shares from The Source.
The warrant was issued to the selling stockholder on October 7, 1997 in
connection with the selling stockholder's services as an underwriter for a
public offering of The Source's common stock in October 1997.
In the warrant, The Source granted the selling stockholder the right to
demand registration of the shares and, in accordance with a demand for
registration made by the selling stockholder, The Source has filed with the
Securities and Exchange Commission, under the Securities Act of 1933, a
Registration Statement on Form S-3, of which this prospectus forms a part, with
respect to the resale of the shares. The Source has agreed to prepare and file
such amendments and supplements to the Registration
10
<PAGE> 12
Statement and this prospectus as may be necessary to keep the Registration
Statement effective until the shares are no longer required to be registered for
the sale thereof by the selling stockholder.
<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP BENEFICIAL OWNERSHIP
PRIOR TO OFFERING NUMBER OF AFTER OFFERING
-------------------- SHARES --------------------
NUMBER BEING NUMBER
SELLING STOCKHOLDER OF SHARES PERCENT OFFERED OF SHARES PERCENT
- ------------------- --------- ------- --------- --------- -------
<S> <C> <C> <C> <C> <C>
Donald & Co. Securities, Inc............... 302,850(1) 1.8% 200,000 102,850(1) 0.6%
</TABLE>
- ---------------
(1) The selling stockholder is a broker-dealer which makes a market in The
Source's common stock. The number of shares of common stock beneficially
owned by the selling stockholders in connection with its market making
activities varies on a daily basis. The selling stockholder has the right to
purchase an additional 100,000 shares of common stock pursuant to a warrant
that The Source issued in June 1998.
The selling stockholder has not held any position, office or other material
relationship with The Source or its affiliates within the past three years,
except that the selling stockholder (i) has served as an underwriter in
connection with public offerings of The Source's common stock in October 1997,
June 1998 and June 1999 and (ii) serves as a financial adviser to The Source at
a fee of $3,000 per month under an arrangement which will expire on June 7,
2000.
PLAN OF DISTRIBUTION
The shares of common stock are being offered on behalf of the selling
stockholder and The Source will not receive any proceeds from the offering. The
shares of common stock may be sold or distributed from time to time by the
selling stockholder, or by pledgees, donees or transferees of, or other
successors in interest to, the selling stockholder, directly to one or more
purchasers (including pledgees) or through brokers, dealers or underwriters who
may act solely as agent or may acquire such shares as principals, at market
prices prevailing at the time of sale, at prices related to such prevailing
market prices, at negotiated prices, or at fixed prices, which may be subject to
change. The sale of the shares of common stock may be effected in one or more of
the following methods: (i) ordinary brokers' transactions, which may include
long or short sales; (ii) transactions involving cross or block trades or
otherwise on the Nasdaq National Market; (iii) purchases by brokers, dealers or
underwriters as principal and resale by such purchasers for their own accounts
pursuant to this prospectus; (iv) "at the market" to or through market makers or
into established trading markets, or by the selling stockholder through its own
market making activities, including direct sales to purchasers or sales effected
through agents; (vi) any combination of the foregoing, or by any other legally
available means. In addition, the selling stockholders or their successors in
interest may enter into hedging transactions with broker-dealers who may engage
in short sales of shares of common stock in the course of hedging the position
they assume with the selling stockholder. The selling stockholder or their
successors in interest may also enter into option or other transactions with
broker-dealers that require the delivery by such broker-dealers of the shares of
common stock, which shares of common stock may be resold thereafter pursuant to
this prospectus. There can be no assurance that all or any of the shares of
common stock will be issued to, or sold by, the selling stockholder.
Brokers, dealers, underwriters or agents participating in the sale of the
shares of common stock as agents may receive compensation in the form of
commissions, discounts or concessions from the selling stockholder or purchasers
of the common stock for whom such broker-dealers may act as agent, or to whom
they may sell as principal, or both (which compensation to a particular
broker-dealer may be less than or in excess of customary commissions). The
selling stockholders and any broker-dealers or other persons who act in
connection with the sale of the common stock hereunder may be deemed to be
"Underwriters" within the meaning of the Securities Act, and any commission they
receive and proceeds of any sale of such shares may be deemed to be underwriting
discounts and commissions under the Securities Act. Neither The Source nor the
selling stockholder can presently estimate the amount of such compensation. The
Source knows of no existing arrangements between the selling stockholder and any
11
<PAGE> 13
other stockholders, broker, dealer, underwriter or agent relating to the sale or
distribution of the shares of common stock.
The selling stockholder and any other persons participating in the sale or
distribution of the common stock will be subject to applicable provisions of the
Exchange Act and the rules and regulations thereunder, which provisions may
limit the timing of purchases and sales of any of the common stock by the
selling stockholder or any other such persons. The foregoing may affect the
marketability of the common stock.
The Source will pay substantially all of the expenses incident to the
registration, offering and sale of the common stock to the public other than
commissions or discounts of underwriters, broker-dealers or agents.
LEGAL MATTERS
The validity of the shares of common stock offered by this prospectus will
be passed upon for The Source by Armstrong Teasdale LLP, St. Louis, Missouri.
EXPERTS
The consolidated financial statements of The Source Information Management
Company as of January 31, 1997 and 1998 and for the fiscal years ended January
31, 1997, 1998 and 1999 incorporated by reference in this prospectus have been
audited by BDO Seidman, LLP independent certified public accountants, and are
incorporated herein in reliance upon such report given upon the authority of
said Firm as experts in accounting and auditing.
The consolidated financial statements of U.S. Marketing Services, Inc. as
of December 31, 1998 and for the period from March 25, 1998 through December 31,
1998 incorporated by reference in this prospectus have been audited by BDO
Seidman, LLP, and are incorporated herein in reliance upon such report given
upon the authority of said Firm as experts in accounting and auditing.
The combined financial statements of Brand Manufacturing Corp. and T.C.E.
Corporation as of May 20, 1998 and for the period from January 1, 1998 through
May 20, 1998 incorporated by reference in this prospectus have been audited by
BDO Seidman, LLP, and are incorporated herein in reliance upon such report given
upon the authority of said Firm as experts in accounting and auditing.
The financial statements of Brand Manufacturing Corp. as of December 31,
1997, and for the year ended December 31, 1997 incorporated in this prospectus
and Registration Statement of The Source Information Management Company have
been audited by Ernst & Young LLP, independent auditors, as set forth in their
report on these financial statements incorporated in this prospectus, and are
included in reliance upon this report given upon the authority of Ernst & Young
LLP as experts in auditing and accounting.
The financial statements of T.C.E. Corporation as of December 31, 1997, and
for the year ended December 31, 1997 incorporated in this prospectus and
Registration Statement of The Source Information Management Company have been
audited by Ernst & Young LLP, independent auditors, as set forth in their report
on these financial statements incorporated in this prospectus, and are included
in reliance upon this report given upon the authority of Ernst & Young LLP as
experts in auditing and accounting.
The combined financial statements of MYCO, Inc. and RY, Inc. as of December
31, 1997 and 1998 and for the years ended December 31, 1997 and 1998
incorporated in this prospectus and Registration Statement of The Source
Information Management Company have been audited by Altschuler, Melvoin and
Glasser LLP, independent auditors, as set forth in their report on these
financial statements incorporated in this prospectus, and are included in
reliance upon this report given upon the authority of Altschuler, Melvoin and
Glasser LLP as experts in auditing and accounting.
12
<PAGE> 14
WHERE YOU CAN FIND MORE INFORMATION
The Source has filed a registration statement on Form S-3 with the
Securities and Exchange Commission in connection with this offering. In
addition, The Source files annual, quarterly and current reports, proxy
statements and other information with the Securities and Exchange Commission.
You may read and copy the registration statement and any other documents filed
by The Source at the Securities and Exchange Commission's Public Reference Room
at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the Securities
and Exchange Commission at 1-800-SEC-0330 for further information on the Public
Reference Room. The Source's Securities and Exchange Commission filings are also
available to the public at the Securities and Exchange Commission's Internet
site at http://www.sec.gov. In addition, reports, proxy statements and other
information concerning The Source may be inspected at the offices of the Nasdaq
Stock Market, 1735 K Street N.W., Washington, D.C. 20549, on which the common
stock is quoted.
This prospectus is part of the registration statement and does not contain
all of the information included in the registration statement. Whenever a
reference is made in this prospectus to any contract or other document of The
Source, the reference may not be complete and you should refer to the exhibits
that are a part of the registration statement for a copy of the contract or
document.
The Securities and Exchange Commission allows The Source to "incorporate by
reference" into this prospectus the information The Source files with it, which
means that The Source can disclose important information to you by referring you
to those documents. Information incorporated by reference is part of this
prospectus. Later information filed with the Securities and Exchange Commission
will update and supersede this information.
The Source incorporates by reference the documents listed below and any
future filing made with the Securities and Exchange Commission under Sections
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until this
offering is completed:
- Annual Report on Form 10-KSB for the year ended January 31, 1999;
- Current Reports on Form 8-K filed on March 11, 1999 and on Form 8-K/A
filed on March 23, 1999, May 12, 1999, June 10, 1999 and June 25, 1999.
- The description of our common stock in our Registration Statement on
Form S-2 filed with the Commission on April 23, 1999.
- Amendment to Annual Report on Form 10KSB/A for the year ended January
31, 1999, filed on June 10, 1999.
- Quarterly Report on Form 10-Q for the quarter ended April 30, 1999.
You may request a copy of these filings, at no cost, by contacting The Source
at:
The Source Information Management Company
11644 Lilburn Park Road
St. Louis, Missouri 63146
Attention: W. Brian Rodgers
Telephone number: (314) 995-9040
13
<PAGE> 15
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
THE SOURCE INFORMATION
MANAGEMENT COMPANY
200,000 SHARES
COMMON STOCK
------------------------
PROSPECTUS
------------------------
July , 1999
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
You should rely only on the information contained in this prospectus. No dealer,
salesperson or other person is authorized to give information that is not
contained in this prospectus. 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.
<PAGE> 16
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The Source will pay all costs and expenses incurred in connection with the
registration of the resale of the shares of common stock under the Securities
Act. The selling stockholder will pay the costs associated with any sales of the
shares of common stock, including any discounts, commissions and applicable
transfer taxes. The following is an itemized statement of the estimated amounts
of all expenses payable by The Source in connection with the registration of the
shares of common stock offered hereby:
<TABLE>
<S> <C>
SEC Registration Fee........................................ $ 807
Printing Expenses........................................... 1,000
Legal Fees and Expenses..................................... 3,000
Auditors' Fees and Expenses................................. 2,500
Transfer Agent and Registrar Fees........................... 1,000
Miscellaneous Expenses...................................... 2,193
-------
Total....................................................... $10,500
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 351.355 of the Missouri General and Business Corporation Law and
Article Eight of The Source's Bylaws provide for indemnification of the
Registrant's directors, officers and employees in a variety of circumstances,
which may include liabilities under the Securities Act. The Registrant also
maintains directors' and officers' liability insurance.
The Source has entered into an indemnification agreement with its directors
and certain of its executive officers. The form of indemnity agreement provides
that such persons will be indemnified to the full extent permitted by applicable
law against all expenses (including attorneys' fees), judgments, fines,
penalties and amounts paid in settlement of any threatened, pending or completed
action, suit or proceeding, on account of such person's services as a director
or executive officer of The Source or any other company or enterprise in which
he is serving at the request of The Source, or as a guarantor of any debt of The
Source. To the extent the indemnification provided under the agreement exceeds
that permitted by applicable law, indemnification may be unenforceable or may be
limited to the extent it is found by a court of competent jurisdiction to be
contrary to public policy.
The Source has procured and intends to maintain a policy of insurance under
which the directors and officers of The Source will be insured, subject to the
limits of the policy, against certain losses arising from claims made against
such directors and officers by reason of any acts or omissions covered under
such policy in their respective capacities as directors or officers.
II-1
<PAGE> 17
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(A) EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <S>
3.1 Articles of Incorporation(1)
3.2 Bylaws(1)
3.3 Amendment to Articles of Incorporation(2)
3.4 Amendments to Bylaws(2)
3.5 Amendment to Articles of Incorporation(3)
3.6 Amendment to Articles of Incorporation(4)
4.1 Form of Common Stock Certificate(2)
4.2 Form of Representative's Warrants(2)
4.3 Form of Privately Issued Warrant(2)
5.1 Opinion of Armstrong Teasdale LLP*
23.1 Consent of BDO Seidman, LLP (Source)*
23.2 Consent of BDO Seidman, LLP (U.S. Marketing)*
23.3 Consent of BDO Seidman, LLP (Brand and T.C.E.)*
23.4 Consent of Ernst & Young LLP (Brand)*
23.5 Consent of Ernst & Young LLP (T.C.E.)*
23.6 Consent of Altschuler, Melvoin and Glasser LLP*
23.7 Consent of Armstrong Teasdale LLP (included in Exhibit 5.1)
24.1 Power of Attorney(5)
</TABLE>
- ---------------
* Filed herewith.
(1) Incorporated by reference to Registration Statement on Form 10-SB (File no.
0-26238)
(2) Incorporated by reference to Registration Statement on Form SB-2 (File no.
333-32733)
(3) Incorporated by reference to Form 10-KSB for the fiscal year ended January
31, 1996
(4) Incorporated by referenced to Form 10-KSB for the fiscal year ended January
31, 1999
(5) This exhibit is contained on the signature page hereof.
(B) FINANCIAL STATEMENT SCHEDULES.
None.
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;
(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. Notwithstanding the foregoing, any increase or decrease in 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 end 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 a 20% 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
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission 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.
(2) 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.
(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 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 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the 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.
II-2
<PAGE> 18
(d) The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities
Act of 1933, the information omitted from the form of prospectus filed as
part of this Registration Statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the Registrant pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act of 1933 shall be
deemed to be part of this Registration Statement as of the time it was
declared effective.
(2) For the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a form
of prospectus shall be deemed to be a new registration statement relating
to the securities offered therein, and offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-3
<PAGE> 19
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements 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 County of St. Louis and State of Missouri on the 22nd day of
July, 1999.
THE SOURCE INFORMATION
MANAGEMENT COMPANY
/s/ S. LESLIE FLEGEL
By:
--------------------------------------
S. Leslie Flegel
Chairman of the Board and
Chief Executive Officer
Each person whose signature appears below constitutes and appoints S.
Leslie Flegel and W. Brian Rodgers his true and lawful attorneys-in-fact and
agents, each acting alone, with full powers of substitution and re-substitution
for him or her and in his or her name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this Registration Statement and to sign a Registration Statement pursuant to
Section 462(b) of the Securities Act, 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, each
acting alone, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the premises, as fully to
all intents and purposes as he or she might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, each acting
alone, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ S. LESLIE FLEGEL Chairman of the Board, Chief Executive July 22, 1999
- --------------------------------------------- Officer and Director (Principal
S. Leslie Flegel Executive Officer)
/s/ W. BRIAN RODGERS Assistant Secretary, Chief Financial July 22, 1999
- --------------------------------------------- Officer (Principal Financial Officer and
W. Brian Rodgers Principal Accounting Officer)
/s/ RICHARD A. JACOBSON Vice Chairman, Chief Operating Officer July 22, 1999
- --------------------------------------------- and Director
Richard A. Jacobson
/s/ WILLIAM H. LEE Vice Chairman, Chairman of the July 22, 1999
- --------------------------------------------- Executive Committee and Director
William H. Lee
/s/ ROBERT ADERS Director July 22, 1999
- ---------------------------------------------
Robert Aders
</TABLE>
II-4
<PAGE> 20
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ TIMOTHY A. BRASWELL Director July 22, 1999
- ---------------------------------------------
Timothy A. Braswell
/s/ HARRY L. FRANC, III Director July 22, 1999
- ---------------------------------------------
Harry L. Franc, III
/s/ ARON KATZMAN Director July 22, 1999
- ---------------------------------------------
Aron Katzman
/s/ RANDALL S. MINIX Director July 22, 1999
- ---------------------------------------------
Randall S. Minix
</TABLE>
II-5
<PAGE> 21
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<C> <S>
3.1 Articles of Incorporation(1)
3.2 Bylaws(1)
3.3 Amendment to Articles of Incorporation(2)
3.4 Amendments to Bylaws(2)
3.5 Amendment to Articles of Incorporation(3)
3.6 Amendment to Articles of Incorporation(4)
4.1 Form of Common Stock Certificate(2)
4.2 Form of Representative's Warrants(2)
4.3 Form of Privately Issued Warrant(2)
5.1 Opinion of Armstrong Teasdale LLP*
23.1 Consent of BDO Seidman, LLP (Source)*
23.2 Consent of BDO Seidman, LLP (U.S. Marketing)*
23.3 Consent of BDO Seidman, LLP (Brand and T.C.E.)*
23.4 Consent of Ernst & Young LLP (Brand)*
23.5 Consent of Ernst & Young LLP (T.C.E.)*
23.6 Consent of Altschuler, Melvoin and Glasser LLP*
23.7 Consent of Armstrong Teasdale LLP (included in Exhibit 5.1)
24.1 Power of Attorney(5)
</TABLE>
- ---------------
* Filed herewith.
(1) Incorporated by reference to Registration Statement on Form 10-SB (File no.
0-26238)
(2) Incorporated by reference to Registration Statement on Form SB-2 (File no.
333-32733)
(3) Incorporated by reference to Form 10-KSB for the fiscal year ended January
31, 1996
(4) Incorporated by referenced to Form 10-KSB for the fiscal year ended January
31, 1999
(5) This exhibit is contained on the signature page hereof.
II-6
<PAGE> 1
EXHIBIT 5
ARMSTRONG, TEASDALE LLP Attorneys at Law
One Metropolitan Square, Suite 2600
St. Louis, Missouri 63102-2740
Phone: (314) 621-5070
Fax: (314) 621-5065
www.armstrongteasdale.com
July 22, 1999
Board of Directors
The Source Information Management Company
11644 Lilburn Park Road
St. Louis, Missouri 63146
We are counsel for The Source Information Management Company, a Missouri
corporation (the "Company"), in connection with the registration under the
Securities Act of 1933, as amended (the "Act"), of 200,000 shares of common
stock, par value $.01 per share (the "Shares"), to be issued by the Company to
Donald & Co. upon the exercise of a warrant (the "Warrant"). A Registration
Statement on Form S-3 (the "Registration Statement") with respect to the Shares
is being filed concurrently herewith with the Securities and Exchange
Commission.
As counsel, we have reviewed the Warrant and the organizational documents
of the Company, including the Articles of Incorporation and Bylaws as amended to
date, and the records of corporate proceedings and other actions taken by the
Company in connection with the authorization, issuance and sale of the Shares.
Where questions of fact material to the opinions hereinafter expressed were not
independently established, we have relied upon statements of officials of the
Company. We have assumed the genuineness of all signatures and the authenticity
of all items submitted to us as originals and the conformity with originals of
all items submitted to us as copies.
Based upon the foregoing, we are of the opinion that:
1. The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Missouri.
2. The Shares to be issued pursuant to the Warrant are duly and validly
authorized.
3. When the Shares are issued by the Company in accordance with the
provisions of the Warrant, such Shares will be duly and validly issued, fully
paid and nonassessable.
We hereby consent to filing of this opinion with the Securities and
Exchange Commission as an exhibit to the Registration Statement.
s/ARMSTRONG TEASDALE LLP
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Source Information Management Company
St. Louis, Missouri
We hereby consent to the incorporation by reference in the Prospectus
constituting a part of this Registration Statement of our report dated April 16,
1999, relating to the consolidated financial statements and schedules of The
Source Information Management Company appearing in the Company's Annual Report
on Form 10KSB/A for the year ended January 31, 1999.
/s/ BDO Seidman, LLP
St. Louis, Missouri
July 22, 1999
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Source Information Management Company
St. Louis, Missouri
We hereby consent to the use in the Prospectus constituting a part of this
Registration Statement of The Source Information Management Company of our
report dated March 9, 1999, relating to the consolidated financial statements
U.S. Marketing Services, Inc. and subsidiaries.
We also consent to the reference to us under the capital "Experts" in the
Prospectus.
/s/ BDO Seidman, LLP
New York, New York
July 22, 1999
<PAGE> 1
EXHIBIT 23.3
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Source Information Management Company
St. Louis, Missouri
We hereby consent to the use in the Prospectus constituting a part of this
Registration Statement of The Source Information Management Company of our
report dated March 9, 1999, relating to the consolidated financial statements
Brand Manufacturing Corp. and T.C.E. Corporation.
We also consent to the reference to us under the capital "Experts" in the
Prospectus.
/s/ BDO Seidman, LLP
New York, New York
July 22, 1999
<PAGE> 1
EXHIBIT 23.4
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3 No. 333-XXXXX) and related Prospectus of The
Source Information Management Company for the registration of 200,000 shares of
its common stock and to the incorporation by reference therein of our report
dated April 17, 1998, with respect to the financial statements of Brand
Manufacturing Corp. included in its Annual Report (Form 10-K) for the year ended
December 31, 1997 filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Vienna, Virginia
July 22, 1999
<PAGE> 1
EXHIBIT 23.5
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3 No. 333-XXXXX) and related Prospectus of The
Source Information Management Company for the registration of 200,000 shares of
its common stock and to the incorporation by reference therein of our report
dated April 17, 1998, with respect to the financial statements of T.C.E.
Corporation included in its Annual Report (Form 10-K) for the year ended
December 31, 1997 filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Vienna, Virginia
July 22, 1999
<PAGE> 1
EXHIBIT 23.6
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Source Information Management Company
St. Louis, Missouri
We hereby consent to the incorporation by reference in this Form S-3
Registration Statement of The Source Information Management Company of our
report dated May 3, 1999, relating to the combined financial statements of MYCO,
Inc. and RY, Inc., which is included in the current report on Form 8-K/A filed
by The Source Information Management Company on June 24, 1999.
/s/ Altschuler, Melvoin and Glasser
LLP
Rolling Meadows, Illinois
July 19, 1999
