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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 27, 1997.
Registration No.DECEMBER 9, 1997
REGISTRATION NO. 333-40331
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------------------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
--------------------
INTERNATIONAL ALLIANCE SERVICES, INC.
(Exact nameNames of RegistrantRegistrants as specifiedSpecified in its charter)
DELAWARE 22-2769024Its Charter)
DELAWARE 22-279024
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
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10055 SWEET VALLEY DRIVE
VALLEY VIEW, OHIO 44125
(216) 447-9000
(Address, including zip code,Including Zip Code, and telephone number, including area code,Telephone Number, Including
Area Code, of Registrant's principal executive offices)
--------------------
EDWARD F. FEIGHAN
INTERNATIONAL ALLIANCE SERVICES, INC.Principal Executive Offices)
---------------------
GREGORY J. SKODA
EXECUTIVE VICE PRESIDENT
10055 SWEET VALLEY DRIVE
VALLEY VIEW, OHIO 44125
(216) 447-9000
(Name, address, including zip code,Address, Including Zip Code, and telephone number, including area code,Telephone Number, Including Area Code,
of agentAgent for service)
--------------------Service)
---------------------
With Copiesa copy to:
RICK L. BURDICK,SETH R. MOLAY, P.C.
AKIN, GUMP, STRAUSS, HAUER & FELD, L.L.P.
1900 PENNZOIL PLACE-SOUTH TOWER
711 LOUISIANA STREET
HOUSTON,1700 PACIFIC AVENUE, SUITE 4100
DALLAS, TEXAS 77002
(713) 220-5800
--------------------75201
(219) 969-2800
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement.registration statement, as determined
by the registrant.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box: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]box. [X]
If this Formform 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:offering. [ ]
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If this Formform is a post-effective amendment filed pursuant to Rule 462(d)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:offering. [ ]
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If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box:box. [ ]
==========================================================================================================================
TITLE OF EACH CLASS OF AMOUNT TO BE PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
SECURITIES TO BE REGISTERED OFFERING PRICE(1) AGGREGATE OFFERING REGISTRATION FEE
REGISTERED PRICE(1)
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Common Stock, par value 5,366,139 shares $9.75625 $52,353,393 $15,865
$.01 per share
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(1) Estimated pursuant to Rule 457(c) solely for the purpose of calculating the
amount of the registration fee based on the average of the high and low prices
of the Common Stock reported by the Nasdaq National Market on May 21, 1997.
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 REGISTRAITONREGISTRATION
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 SECURITIES AND EXCHANGE COMMISSION,
ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
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INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS
OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED MAY 27,DECEMBER 9, 1997
PROSPECTUS
5,366,139 SHARES, 1997
$125,000,000
INTERNATIONAL ALLIANCE SERVICES, INC.
DEBT SECURITIES
COMMON STOCK
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This Prospectus relatesWARRANTS
International Alliance Services, Inc. (the "Company" or "IASI") may offer
and issue from time to an aggregatetime (i) debt securities of 5,366,139the Company ("Debt
Securities"), consisting of debentures, notes, bonds and other unsecured
evidences of indebtedness in one or more series, (ii) shares (the
"Shares") of common stock,
par value $.01 per share of the Company ("Common Stock"), of
International Alliance Services, Inc., a Delaware corporation (formerly knownand (iii) warrants to
purchase Debt Securities or Common Stock ("Warrants"). The foregoing securities
are collectively referred to as Republic Environmental Systems, Inc., the "Company"), which"Securities." Any Securities may be offered
from timewith other Securities or separately. The Securities will be offered at an
aggregate initial offering price not to time (the "Offering") by persons (the "Selling Stockholders") who
have acquired such Sharesexceed $125,000,000.
SEE "RISK FACTORS" IN THE ACCOMPANYING PROSPECTUS SUPPLEMENT FOR A
DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE
PURCHASERS OF THE SECURITIES.
Certain terms of any Debt Securities in certain private equity offerings and certain
acquisitionsrespect of businesses bywhich this Prospectus is
being delivered will be set forth in an accompanying Prospectus Supplement
including, without limitation, the Company not involving a public offering
including 1,210,611 shares whichspecific designation, aggregate principal
amount, purchase price, currency of payment, denomination, maturity, interest
rate (which may be offered for sale by certainfixed or variable) and time of the
Selling Stockholders who may acquire such shares pursuant to the exercisepayment of certain warrants. The Shares are being registered under the Securities Act of
1933, as amended (the "Securities Act")interest (if any),
on behalf of the Selling Stockholders
in order to permit the public sale or other distribution of the Shares.
The Shares may be sold or distributed from time to time by orguarantees thereof (if any), terms (if any) for the account of the Selling Stockholders,subordination, redemption,
purchase or by their pledgeesconversion thereof, listing (if any) on behalf of the
Selling Stockholders, in transactions (which may involve crosses and block
transactions) on the Nasdaq National Market ("Nasdaq") or any nationala securities exchange,
additional or U.S. inter-dealer quotation systemdifferent covenants and events of a registered
national securities association on which the Shares are then listed, in the
over-the- counter market, in one or more privately negotiated transactions
(including sales pursuant to pledges), through the writing of options on the
Shares, in a combination of such methods of distribution or by any other
legally available means. This Prospectus also may be used, with the Company's
consent, by donees of the Selling Stockholders, or by other persons acquiring
Shares and who wish to offer and sell such Shares under circumstances requiring
or making desirable its use. Such methods of sale may be conducted by the
Selling Stockholders at market prices prevailing at the time of sale, at prices
related to such prevailing market prices or at prices otherwise negotiated.
The Selling Stockholders may effect such transactions directly, or indirectly
through broker-dealers or agents acting on their behalf and, in connection with
such sales, such broker-dealers or agents may receive compensation in the form
of commissions or discounts from the Selling Stockholders and/or the purchasers
of the Shares for whom they may act as agent or to whom they sell Shares as
principal or both (which commissions or discounts might be in excess of
customary commissions). To the extent required, the Company will file, during
any period in which offers or sales are being made, one or more supplements to
this Prospectus to set forth the names of donees of Selling Stockholdersdefault, and any other material
terms of the Debt Securities. The purchase price of any Common Stock in respect
of which this Prospectus is being delivered will be set forth in an accompanying
Prospectus Supplement. The Prospectus Supplement will also contain information,
with respectwhere applicable, about certain United States federal income tax considerations
relating to the plan of distribution not
previously disclosed. See "Plan of Distribution."
The Company will not receive any of the proceeds from the sale of the
Shares offered hereby, but will bear all expenses incident to the registration
of the Shares under federal and state securities laws and the sale of the
Shares hereunder other than expenses incident to the delivery of the Shares to
be soldSecurities covered by the Selling Stockholders, including any transfer taxes payable on
any Shares, and any commissions and discounts payable to underwriters, agents
or dealers.Prospectus Supplement.
The Company's Common Stock is quoted on The Nasdaq National Market under
the symbol "IASI." On May
15, 1997, the last reported sale price for theAny Common Stock as reported byoffered hereby will be listed, subject to
official notice of issuance, on The Nasdaq was $10.00 per share. The Company had 35,969,379 shares of Common Stock
issued and outstanding as of May 15, 1997.
PROSPECTIVE INVESTORS SHOULD CAREFULLY CONSIDER THE MATTERS SET FORTH
UNDER THE CAPTION "RISK FACTORS" LOCATED ON PAGE 5 OF THIS PROSPECTUS.
-------------------National Market.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
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The dateSecurities may be sold on a negotiated or competitive bid basis to or
through underwriters or dealers designated from time to time or to other
purchasers directly or through agents designated from time to time. Certain
terms of any offering and sale of the Securities, including, where applicable,
the names of the underwriters, dealers or agents, if any, the principal amount
or number of shares to be purchased, the purchase price of the Securities, the
proceeds to the Company from such sale and any applicable commissions, discounts
and other items constituting compensation of such underwriters, dealers or
agents will also be set forth in an accompanying Prospectus Supplement.
THIS PROSPECTUS MAY NOT BE USED TO CONSUMMATE SALES OF SECURITIES UNLESS
ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
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THE COMPANY
OVERVIEW
IASI is a leading provider of outsourced business services to small and
medium sized companies throughout the United States. The Company provides
integrated services in the following areas: accounting systems, advisory and
tax; employee benefits design and administration; human resources; information
technology systems; payroll; specialty insurance; valuation; and workers'
compensation. These services are provided through a network of over 65 Company
offices in 25 states, as well as through its subsidiary Comprehensive Business
Services ("Comprehensive"), a franchisor of accounting services with
approximately 250 franchisee offices located in 40 states. As of December 9,
1997, the Company served approximately 60,000 clients, of which approximately
24,000 are served through the Comprehensive franchisee network. Management
estimates that its clients employ over 800,000 employees, including 240,000
employed by clients of the Comprehensive franchise network.
The Company's clients typically have fewer than 500 employees, and prefer
to focus their scarce resources on operational competencies while allowing IASI
to provide non-core administrative functions. In many instances, outsourcing
administrative functions allows clients to enhance productivity, reduce costs,
and improve service, quality and efficiency. Depending on a client's size and
capabilities, it may choose to utilize all or a portion of the Company's broad
array of services, which it typically accesses through a single Company
representative.
Pursuant to a strategic redirection of the Company initiated in November
1996, the Company began its acquisition program to expand its operations rapidly
in the outsourced business services industry from its existing insurance
platform. From November 1, 1996 through September 30, 1997, the Company acquired
the businesses of 23 companies representing over $90 million in revenues. The
Company's acquisition program typically focuses on (i) market entry acquisitions
in which the Company establishes a significant presence in a city or (ii)
follow-on acquisitions of additional service providers in areas where the
Company's presence is established, increasing the number of clients served and
services offered in such markets. The Company seeks to acquire profitable,
well-run companies and to continue to employ their existing management teams,
providing them with incentive by utilizing restricted IASI Common Stock for a
large portion of the consideration for the acquisitions. The Company believes
that substantial additional acquisition opportunities exist throughout the
United States for several reasons, including the highly fragmented nature of the
industry, the advantages of economies of scale, and the desire of many long-time
owners for liquidity. The Company has completed from October 1, 1997 through
December 9, 1997, or has announced as pending, an additional 20 acquisitions
representing over $78 million in revenues.
The outsourced business services industry in which the Company currently
operates is highly fragmented with approximately 600,000 outsourcing
establishments collectively generating approximately $300 billion in annual
revenue and has grown at a compound annual rate in excess of 9% since 1992. The
Company believes that this growth reflects the following trends: (i) more
companies are now utilizing outsourced business services, (ii) companies that
have traditionally used a limited amount of outsourced business services are now
utilizing a broader array of such services, and (iii) the number of small and
medium sized businesses in the United States continues to grow.
The Company's goal is to be the nation's premier provider of outsourced
business services to small and medium sized companies. The Company's strategies
to achieve this goal include: (i) continuing to provide clients with a broad
range of high quality services, (ii) continuing to expand locally through
internal growth by increasing the number of clients it serves and increasing the
number of services it provides to existing clients, and (iii) continuing to
expand nationally through an aggressive acquisition program.
Effective December 31, 1997, the name of the Company will be changed to
"Century Business Services, Inc.", and the symbol of the Company will be changed
to "CBIZ." The Company's principal executive offices are located at 10055 Sweet
Valley Drive, Valley View, Ohio 44125, and its telephone number is (216)
447-9000.
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USE OF PROCEEDS
Unless a Prospectus Supplement indicates otherwise, the net proceeds to be
received by the Company from the issue and sale from time to time of the
Securities will be added to the general funds of the Company to be used for
general corporate purposes, working capital requirements and the cash portion of
acquisitions. Pending such application, such net proceeds may be invested in
short-term marketable securities. Each Prospectus Supplement will contain
specific information concerning the use of proceeds from the sale of Securities
to which it relates.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the Company's historical ratio of earnings
to fixed charges for the three years ended December 31, 1996, and the nine
months ended September 30, 1996 and 1997:
NINE MONTHS
ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30,
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1994 1995 1996 1996 1997
------ ----- ------ ----- ----
Ratio(1)..................................... 187.3 78.6 113.3 463.0 41.8
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(1) For purposes of computing the ratio of earnings to fixed charges, earnings
consist of pretax income from continuing operations adjusted to exclude
interest expense. Fixed charges consist of interest expense on capitalized
lease obligations and debt borrowings.
DESCRIPTION OF DEBT SECURITIES
The following sets forth certain general terms and provisions of the
Indenture (as defined herein) under which the Debt Securities are to be issued.
The particular terms of the Debt Securities will be set forth in a Prospectus
Supplement relating to such Debt Securities.
The Debt Securities are to be issued under one or more Indentures, as
amended or supplemented from time to time (the "Indenture"), to be entered into
between the Company, the guarantors (as defined below), if any, and Star Bank,
N.A., as trustee, (together with any other trustee(s) chosen by the Company,
qualified to act as such under the Trust Indenture Act of 1939, as amended (the
"TIA") and appointed in a supplemental indenture with respect to a particular
series, the "Trustee"). The form of Indenture has been filed as an exhibit to
the Registration Statement of which this Prospectus is May ___,a part and will be
available for inspection at the corporate trust office of the Trustee, or as
described above under "Available Information." The Indenture is subject to, and
governed by, the TIA. The Company will execute an Indenture if and when the
Company issues any Debt Securities. The statements made hereunder relating to
the Indenture and the Debt Securities to be issued thereunder are summaries of
certain provisions thereof and do not purport to be complete and are subject to,
and are qualified in their entirety by reference to, all provisions of the
Indenture (including those terms made a part of the Indenture by reference to
the TIA) and such Debt Securities. Capitalized terms used but not defined herein
shall have the respective meanings set forth in the Indenture. References below
to an "Indenture" are deemed to constitute a reference to the applicable
Indenture under which a particular series of Debt Securities is issued.
GENERAL
The Debt Securities will be unsecured obligations of the Company. The Debt
Securities may be issued in one or more series. Specific terms of each series of
Debt Securities will be contained in authorizing resolutions or a supplemental
indenture relating to that series. There will be Prospectus Supplements relating
to particular series of Debt Securities. Each Prospectus Supplement will
describe, as to the Debt Securities to which it relates: (i) the title of the
Debt Securities; (ii) any limit upon the aggregate principal amount of a series
of Debt Securities which may be issued; (iii) the date or dates on which
principal of the Debt Securities will be payable and the amount of principal
which will be payable; (iv) the rate or rates (which may be fixed or
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variable) at which the Debt Securities will bear interest, if any, as well as
the dates from which interest will accrue, the dates on which interest will be
payable and the record date for the interest payable on any payment date; (v)
the currency or currencies in which principal, premium, if any, and interest, if
any, will be paid; (vi) the place or places where principal, premium, if any,
and interest, if any, on the Debt Securities will be payable and where Debt
Securities which are in registered form can be presented for registration of
transfer or exchange and the identification of any depository or depositories
for any global debt securities; (vii) any provisions regarding the right of the
Company to redeem or purchase Debt Securities or of holders to require the
Company to redeem Debt Securities; (viii) the right, if any, of holders of the
Debt Securities to convert them into stock or other securities of the Company,
including any provisions intended to prevent dilution of the conversion rights
or otherwise; (ix) any provisions by which the Company will be required or
permitted to make payments to a sinking fund which will be used to redeem Debt
Securities or a purchase fund which will be used to purchase Debt Securities;
(x) the percentage of the principal amount at which Debt Securities will be
issued and, if other than the full principal amount thereof, the percentage of
the principal amount of the Debt Securities which is payable if maturity of the
Debt Securities is accelerated because of a default; (xi) the terms, if any,
upon which Debt Securities may be subordinated to other indebtedness of the
Company; (xii) any additions to, modifications of or deletions from the terms of
the Debt Securities with respect to Events of Default or covenants or other
provisions set forth in the Indenture; and (xiii) any other material terms of
the Debt Securities, which may be different than the terms set forth in this
Prospectus.
Each Prospectus Supplement will describe, as to the Debt Securities to
which it relates, any guarantees (the "Guarantees") by certain direct and
indirect subsidiaries of the Company which may guarantee the Debt Securities
(the "Guarantors"), including the terms of subordination, if any, of any such
Guarantee.
EVENTS OF DEFAULT AND REMEDIES
An Event of Default with respect to any series of Debt Securities is
defined in the Indenture as being (i) default for a period of 30 days in payment
of any interest on any Debt Security of such series when it becomes due and
payable, (ii) default in payment of the principal of (or premium, if any), on
any of the Debt Securities of such series at its maturity (iii) default in the
deposit of any sinking fund payment, when and as due by the terms of any Debt
Security of such series, (iv) default by the Company or any Guarantor for a
period of 60 days after notice in the observance or performance of any other
covenants in the Indenture relating to such series, and (v) certain events
involving bankruptcy, insolvency or reorganization of the Company or certain
Guarantors.
The Indenture provides that if any Event of Default has occurred and is
continuing with respect to any series of Debt Securities, the Trustee or the
holders of not less than 25% in principal amount of such series of Debt
Securities then outstanding may declare the principal of all the Debt Securities
of such series to be due and payable immediately. However, the holders of a
majority in principal amount of the Debt Securities of such series then
outstanding by written notice to the Trustee and the Company may waive any Event
of Default (other than any Event of Default in payment of principal or interest
or in respect of certain covenants) with respect to such series of Debt
Securities. Holders of a majority in principal amount of the then outstanding
Debt Securities of any series may rescind an acceleration with respect to such
series and its consequences (except an acceleration due to nonpayment of
principal or interest on such series) if the rescission would not conflict with
any judgment or decree and if all existing Events of Default with respect to
such series have been cured or waived.
The holders of a majority in principal amount of the Debt Securities of any
series then outstanding will have the right to direct the time, method and place
of conducting any proceedings for any remedy available to the Trustee with
respect to such series, subject to certain limitations specified in the
Indenture.
DEFEASANCE OF INDENTURE
The Indenture permits the Company and the Guarantors to terminate all of
their respective obligations under the Indenture as they relate to any
particular series of Debt Securities, other than the obligation to pay interest,
if any, on and the principal of the Debt Securities of such series and certain
other obligations, at any
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time by (i) depositing in trust with the Trustee, under an irrevocable trust
agreement, money or U.S. Government Obligations in an amount sufficient to pay
principal of and interest, if any, on the Debt Securities of such series to
their maturity, and (ii) complying with certain other conditions, including
delivery to the Trustee of an opinion of counsel or a ruling received from the
Internal Revenue Service to the effect that holders will not recognize income,
gain or loss for federal income tax purposes as a result of the Company's
exercise of such right and will be subject to federal income tax on the same
amount and in the same manner and at the same times as would have been the case
otherwise.
In addition, the Indenture permits the Company and the Guarantors to
terminate all of their respective obligations under the Indenture as they relate
to any particular series of Debt Securities (including the obligations to pay
interest, if any, on and the principal of the Debt Securities of such series and
certain other obligations), at any time by (i) depositing in trust with the
Trustee, under an irrevocable trust agreement, money or U.S. government
obligations in an amount sufficient to pay principal of and interest, if any, on
the Debt Securities of such series to their maturity, and (ii) complying with
certain other conditions, including delivery to the Trustee of an opinion of
counsel or a ruling received from the Internal Revenue Service to the effect
that holders will not recognize income, gain or loss for federal income tax
purposes as a result of the Company's exercise of such right and will be subject
to federal income tax on the same amount and in the same manner and at the same
times as would have been the case otherwise, which opinion of counsel is based
upon a change in the applicable federal tax law since the date of the Indenture.
TRANSFER AND EXCHANGE
A holder will be able to transfer or exchange Debt Securities only in
accordance with the provisions of the Indenture. The registrar may require a
holder, among other things, to furnish appropriate endorsements and transfer
documents, and to pay any taxes and fees required or permitted by the Indenture.
AMENDMENT, SUPPLEMENT AND WAIVER
Subject to certain exceptions, the Indenture, the Debt Securities or the
Guarantees of a particular series may be amended or supplemented with the
consent (which may include consents obtained in connection with a tender offer
or exchange offer for Debt Securities) of the holders of at least a majority in
principal amount of the Debt Securities of such series then outstanding, and any
existing Default under, or compliance with any provision of the Indenture
relating to a particular series of Debt Securities may be waived (other than any
continuing Default or Event of Default in the payment of interest on or the
principal of such Debt Securities) with the consent (which may include consents
obtained in connection with a tender offer or exchange offer for Debt
Securities) of the holders of a majority in principal amount of the Debt
Securities of such series then outstanding. Without the consent of any holder,
the Company and the Trustee may amend or supplement the Indenture, the Debt
Securities or the Guarantees to (i) evidence the succession of another Person to
the Company, (ii) add to the covenants of the Company or to surrender a right or
power of the Company, (iii) add any additional Events of Default, (iv) provide
for Debt Securities in bearer form, (v) make any changes when no Debt Securities
are outstanding or that do not apply to any Debt Securities previously entitled
to such benefit, (vi) evidence the succession of another Trustee, or (vii) cure
any ambiguity, defect or inconsistency.
Without the consent of each holder affected, the Company and the Trustee
may not (i) reduce the amount of Debt Securities of such series whose holders
must consent to an amendment, supplement or waiver, (ii) reduce the rate of or
change the time for payment of interest, (iii) reduce the principal of or change
the fixed maturity of any Debt Security or alter the provisions with respect to
redemptions or mandatory offers to repurchase Debt Securities pursuant to
certain covenants set forth in the Indenture, (iv) make any Debt Security
payable in money other than that stated in the Debt Security, (v) modify the
ranking or priority of the Debt Securities or any Guarantee, (vi) release any
Guarantor from any of its obligations under its Guarantee or the Indenture
otherwise than in accordance with the Indenture, or (vii) waive a continuing
default in the payment of principal of or interest on the Debt Securities.
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The right of any holder to participate in any consent required or sought
pursuant to any provision of the Indenture (and the obligation of the Company to
obtain any such consent otherwise required from such holder) may be subject to
the requirement that such holder shall have been the holder of record of any
Debt Securities with respect to which such consent is required or sought as of a
date identified by the Trustee in a notice furnished to holders in accordance
with the terms of the Indenture.
CONCERNING THE TRUSTEE
In the ordinary course of its business, Star Bank, N.A., the Trustee,
provides, and may continue to provide, services to the Company as transfer agent
for the Common Stock of the Company and is a party to the Company's Credit
Agreement dated as of October 3, 1997. 2The Indenture contains certain
limitations on the rights of the Trustee, if it becomes a creditor of the
Company, to obtain payment of claims in certain cases or to realize on certain
property received in respect of any such claim as security or otherwise. The
Trustee will be permitted to engage in other transactions; however, if it
acquires any conflicting interest, it must eliminate such conflict or resign.
The Indenture provides that if an Event of Default occurs and is not cured,
the Trustee will be required, in the exercise of its power, to use the degree of
care of a prudent person in similar circumstances in the conduct of its own
affairs. The Trustee may refuse to perform any duty or exercise any right or
power under the Indenture, unless it receives indemnity, satisfactory to it,
against any loss, liability or expense.
GOVERNING LAW
The Indenture, the Debt Securities and the Guarantees will be governed by
the laws of the State of New York without giving effect to principles of
conflict of laws.
DESCRIPTION OF COMMON STOCK
The Company's authorized capital stock is 100,000,000 shares of Common
Stock, par value $.01 per share. As of December 1, 1997, 40,978,934 shares of
Common Stock were outstanding.
Holders of shares of Common Stock are entitled to one vote for each share
held of record on all matters submitted to a vote of stockholders. There are no
cumulative voting rights with respect to the election of directors. Accordingly,
the holder or holders of a majority of the outstanding shares of Common Stock
will be able to elect the entire Board of Directors of the Company. Holders of
Common Stock have no preemptive rights and are entitled to such dividends as may
be declared by the Board of Directors of the Company out of funds legally
available therefor. The Common Stock is not entitled to any sinking fund,
redemption or conversion provisions. On liquidation, dissolution or winding up
of the Company, the holders of Common Stock are entitled to share ratably in the
net assets of the Company remaining after the payment of all creditors, if any.
The outstanding shares of Common Stock are duly authorized, validly issued,
fully paid and nonassessable. The transfer agent and registrar for the Common
Stock is Star Bank, N.A.
The Company currently has the following provisions in its bylaws which
could be considered to be "anti-takeover" provisions: (i) a bylaw requiring the
affirmative vote of the holders of a majority of the outstanding shares of
Common Stock or two-thirds of the other directors to remove a director and (ii)
a bylaw limiting the persons who may call special meetings of stockholders to
the Board of Directors or the President of the Company. These provisions may
have the effect of delaying stockholder actions with respect to certain business
combinations and the election of new members to the Board of Directors. As such,
the provisions could have the effect of discouraging open market purchases of
the Company's Common Stock because they may be considered disadvantageous by a
stockholder who desires to participate in a business combination or elect a new
director.
The Company is a Delaware corporation and is subject to Section 203 of the
Delaware General Corporation Law. In general, Section 203 prevents an
"interested stockholder" (defined generally as a person owning 15% or more of
the Company's outstanding voting stock) from engaging in a "business
combination" with the Company for three years following the date that person
became an interested stockholder unless:
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38
(i) before that person became an interested stockholder, the Board of Directors
of the Company approved the transaction in which the interested stockholder
became an interested stockholder or approved the business combination; (ii) upon
completion of the transaction that resulted in the interested stockholder
becoming an interested stockholder, the interested stockholder owned at least
85% of the voting stock of the Company outstanding at the time the transaction
commenced (excluding stock held by persons who are both directors and officers
of the Company or by certain employee stock plans); or (iii) on or following the
date on which that person became an interested stockholder, the business
combination is approved by the Company's Board and authorized at a meeting of
stockholders by the affirmative vote of the holders of at least 66 2/3% of the
outstanding voting stock of the Company (excluding shares held by the interested
stockholder). A "business combination" includes mergers, asset sales and other
transactions resulting in a financial benefit to the interested stockholder.
DESCRIPTION OF WARRANTS
The Company may issue Warrants, including Warrants to purchase Debt
Securities or Common Stock as well as other types of Warrants. Warrants may be
issued independently or together with any Debt Securities or Common Stock and
may be attached to or separate from such Debt Securities or Common Stock. Each
series of Warrants will be issued under a separate warrant agreement (each a
"Warrant Agreement") to be entered into between the Company and a warrant agent
("Warrant Agent"). The Warrant Agent will act solely as an agent of the Company
in connection with the Warrants of such series and will not assume any
obligation or relationship of agency or trust for or with any holders or
beneficial owners of Warrants.
The applicable Prospectus Supplement will describe the following terms of
the Warrants in respect of which this Prospectus is being delivered: (i) the
title of such Warrants; (ii) the aggregate number of such Warrants; (iii) the
price or prices at which such Warrants will be issued; (iv) the designation,
aggregate principal amount and terms of the Debt Securities or Common Stock
purchasable upon exercise of such Warrants; (v) if applicable, the designation
and terms of the Debt Securities with which such Warrants are issued and the
number of such Warrants issued with each such Debt Security; (vi) if applicable,
the date on and after which such Warrants and the related Debt Securities will
be separately transferable; (vii) the price at which the Debt Securities or
Common Stock purchasable upon exercise of such Warrants may be purchased; (viii)
the date on which the right to exercise such Warrants shall commence and the
date on which such right shall expire; (ix) if applicable, the minimum or
maximum amount of such Warrants which may be exercised at any one time; (x) if
applicable, any index or formula used to determine the amount of payments of
principal of and any premium and interest on Debt Securities purchasable upon
exercise of Warrants; (xi) information with respect to book-entry procedures, if
any; (xii) if applicable, a discussion of certain United States Federal income
tax considerations; and (xiii) any other terms of such Warrants, including
terms, procedures and limitations relating to the exchange and exercise of such
Warrants.
PLAN OF DISTRIBUTION
The Company may offer and sell the Securities to or through underwriters or
dealers, and also may offer and sell the Securities directly to other purchasers
or through agents.
Each Prospectus Supplement will set forth the terms of the offering of the
particular series of Securities to which the Prospectus Supplement relates,
including the name or names of any underwriters, dealers or agents, the purchase
price or prices of the Securities, the proceeds to the Company from the sale of
such series of Securities, the use of such proceeds, any initial public offering
price or purchase price of such series of Securities, any underwriting discount
or commission, any discounts, concessions or commissions allowed or reallowed or
paid by any underwriters to other dealers, any commissions paid to any agents
and the securities exchanges, if any, on which such Securities will be listed.
Any initial public offering price or purchase price and any discounts,
concessions or commissions allowed or reallowed or paid by any underwriter to
other dealers may be changed from time to time.
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9
Sales of Common Stock offered pursuant to any Prospectus Supplement may be
effected from time to time in one or more transactions through The Nasdaq
National Market, or in negotiated transactions or any combination of such
methods of sale, at market prices prevailing at the time of sale, at prices
related to such prevailing market prices, or at other negotiated prices.
In connection with distributions of Common Stock or otherwise, the Company
may enter into hedging transactions with broker-dealers in connection with which
such broker-dealers may sell Common Stock registered hereunder in the course of
hedging through short sales the positions they assumed with the Company.
In connection with the sale of Securities, underwriters or agents may
receive compensation from the Company or from purchasers of Securities for whom
they may act as agents in the form of discounts, concessions or commissions.
Underwriters may sell Securities to or through dealers, and such dealers may
receive compensation in the form of discounts, concessions or commissions from
the underwriters and/or commissions from the purchasers for whom they may act as
agents. Underwriters, dealers and agents that participate in the distribution of
Securities may be deemed to be underwriters, and any discounts or commissions
received by them from the Company and any profit on the resale of Securities by
them may be deemed to be underwriting discounts and commissions under the
Securities Act. Any such underwriter or agent will be identified, and any such
compensation received from the Company will be described, in the applicable
Prospectus Supplement.
Under agreements which may be entered into by the Company, underwriters and
agents who participate in the distribution of Securities may be entitled to
indemnification by the Company against certain liabilities, including
liabilities under the Securities Act.
If so indicated in the applicable Prospectus Supplement, the Company will
authorize underwriters or other persons acting as the Company's agent to solicit
offers by certain institutions to purchase Debt Securities or Common Stock or
Warrants to purchase Debt Securities or Common Stock from the Company pursuant
to contracts providing for payment and delivery on a future date. Institutions
with which such contracts may be made include commercial and savings banks,
insurance companies, pension funds, investment companies, educational and
charitable institutions and others, but in all cases such institutions must be
approved by the Company. The obligations of any purchaser under any such
contract will be subject to the condition that the purchase of the offered Debt
Securities or Common Stock shall not at the time of delivery be prohibited under
the laws of the jurisdiction to which such purchaser is subject. The
underwriters and such other agents will not have any responsibility in respect
of the validity or performance of such contracts.
The Company may grant underwriters who participate in the distribution of
Common Stock an option to purchase additional Common Stock to cover
over-allotments, if any.
The place and date of delivery for the Securities in respect of which this
Prospectus is being delivered will be set forth in the applicable Prospectus
Supplement.
Unless otherwise indicated in the applicable Prospectus Supplement, the
Securities in respect of which this Prospectus is being delivered (other than
Common Stock) will be a new issue of securities, will not have an established
trading market when issued and will not be listed on any securities exchange.
Any underwriters or agents to or through whom such Securities are sold by the
Company for public offering and sale may make a market in such Securities, but
such underwriters or agents will not be obligated to do so and may discontinue
any market making at any time without notice. No assurance can be given as to
the liquidity of the trading market for any such Securities.
Certain of the underwriters and their affiliates may from time to time
perform various commercial banking and investment banking services for the
Company, for which customary compensation is received.
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LEGAL MATTERS
The validity of the Securities offered hereby will be passed upon for the
Company by Akin, Gump, Strauss, Hauer & Feld, L.L.P. Rick L. Burdick, a partner
of Akin, Gump, Strauss, Hauer & Feld, L.L.P., is a director of the Company and
is the beneficial owner of 62,500 shares of Common Stock (including options and
warrants to purchase Common Stock).
EXPERTS
The consolidated and combined financial statements of International
Alliance Services, Inc. and its subsidiaries as of December 31, 1996 and 1995,
and for each of the years in the three year period ended December 31, 1996, have
been incorporated by reference herein in reliance upon the report of KPMG Peat
Marwick LLP, independent certified public accountants, incorporated by reference
herein, and upon the authority of said firm as experts in accounting and
auditing.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and
regulations promulgated thereunder, (the "Exchange Act"), and, in accordance therewith, files reports,
proxy and information statements and other information with the Securities and
Exchange Commission (the "SEC""Commission"). TheThese reports, proxy and information
statements and other information concerning the Company can be inspected and
copied at the public reference facilities maintained by the SECCommission at Judiciary Plaza, Room
1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the SEC'sCommission's
regional offices located at Citicorp Center, Suite 1400, 500 West Madison
Street, Room 3190, Chicago, Illinois 60661 and at Seven World Trade Center, 13th
Floor, New York, New York 10048. Copies of such material can also be obtained
from the SECCommission at prescribed rates through theits Public Reference Section of the SEC at
450 Fifth Street, N.W., Washington, D.C. 20549. Such documentsThe Commission also may be
obtained throughmaintains a
site on the website maintained by the SECWorld Wide Web at http://www.sec.gov. Suchwww.sec.gov that contains reports, proxy
and information statements and other information mayregarding registrants such as
the Company that file electronically with the Commission. Such material is also
be inspectedavailable for inspection at the offices of Nasdaq atThe National Association of
Securities Dealers, Inc. (the "NASD"), 1735 K Street, N.W., Washington, D.C.
20006.
The Company has filed with the SECCommission a Registration Statement on Form
S-3 under the Securities Act with respect to the Shares (such registration
statement, includingSecurities offered hereby
(including all amendments and supplements thereto, is hereinafter
referred to as the "Registration
Statement"). This Prospectus, which formsconstitutes a part of the Registration
Statement, does not contain all of the information set forth in the Registration
Statement, certain parts of which have been omitted in accordance with the rules
and regulations of the SEC.Commission. For further information with respect to the
Company and such Securities, reference is made to the Registration Statement,
including the documents and exhibits filed or incorporated as a part thereof.
Statements contained in this Prospectus as toherein concerning the contentsprovisions of any contract, agreement or other
documentcertain documents are
not necessarily complete and, in each instance, reference is made to the copy of
such contract, agreement or other document filed as an exhibit to the Registration Statement or incorporated herein by reference, and eachotherwise
filed with the Commission. Each such statement is deemed qualified in its entirety by
such reference. The Registration Statement and the exhibits thereto maycan be
inspected without chargeand copied at the public reference facilities maintained by the SEC,and regional offices of
the SECCommission and at the offices of the SEC and NasdaqNASD referred to above, and copies thereof may
be obtained from the SEC at prescribed rates.
3above.
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411
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, which have been filed by the Company (File No. 0-25890) with the
SECCommission pursuant to the Exchange Act, are incorporated herein by reference and made
a part of this Prospectus: (i) the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1996; (ii) all other reports filed pursuant to
Section 13(a) or 15(d) of the Company's Current Report on Form 8-K dated January 7,
1997;
(iii)Exchange Act since December 31, 1996, specifically
including the Company's Quarterly Report on Form 10-Q for the quarterquarters ended
March 31, 1997;
(iv)1997, June 30, 1997, and September 30, 1997, respectively, and the
Company's Schedule 14ACurrent Reports on Form 8-K dated February 19, 1997 (as amended on
Form 8-K/A filed on April 2, 1997), April 3, 1997, April 21, 1997, and July 23,
1997 (as amended on Form 8-K/A dated October 3, 1997), respectively; and (iii)
the Company's Proxy Statement dated April 1, 1997 relating to the 1997 Annual
Meeting of Stockholders held May 6, 1997;
(v) the Company's Current Report on Form 8-K dated April 3, 1997;
and
(vi) the Company's Current Report on Form 8-K dated April 21, 1997.
All reports and other documents filed by the Company with the SEC
pursuant to SectionSections 13(a), 13(c), 14 or
15(d) of the Exchange Act aftersubsequent to the date of this Prospectus and prior to
the termination of the Offeringoffering shall be deemed to be incorporated by reference
in this Prospectus and to be a part hereof from the date of filing of such
documents. Any statement contained in this
Prospectusa document or in a documentinformation incorporated or
deemed to be incorporated herein by reference in this Prospectus shall be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a statement
contained in this
Prospectusherein or in any other subsequently filed document that also is, or is
deemed to be, incorporated herein by reference, herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Prospectus.
The Company undertakes to provide, without charge, to each person,
including any beneficial owner, to whom a copy of this Prospectus has beenis delivered,
upon the written or oral request of such person, a copy of any orand all of the
documents or information referred to above that has been or may be incorporated
by reference herein, other than thein this Prospectus (excluding exhibits to such documents unless
such exhibits are specifically incorporated by reference into the information that
this Prospectus incorporates. Written or oral requests for such copiesreference). Requests should be
directed to Corporate Secretary, International Alliance Services, Inc., 10055
Sweet Valley Drive, Valley View, Ohio 44125, Attention: Investor Relations, telephone number (216) 447-9000.
411
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RISK FACTORS
IN ADDITION12
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NO DEALER, SALESPERSON OR OTHER PERSON IS AUTHORIZED TO THEGIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION OTHER INFORMATION SET FORTHTHAN THOSE CONTAINED IN THIS
PROSPECTUS PROSPECTIVE
PURCHASERSOR THE ACCOMPANYING PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED. THIS PROSPECTUS AND THE ACCOMPANYING PROSPECTUS SUPPLEMENT DO NOT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES
OTHER THAN THE SECURITIES OFFERED HEREBY, NOR DOES IT CONSTITUTE AN OFFER TO
SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SHARES SHOULD CONSIDER CAREFULLYSECURITIES OFFERED HEREBY
TO ANY PERSON IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION IS
UNLAWFUL. NEITHER THE FOLLOWING RISK FACTORS
IN EVALUATING AN INVESTMENTDELIVERY OF THIS PROSPECTUS AND THE ACCOMPANYING
PROSPECTUS SUPPLEMENT NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCE,
CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE COMPANY.
RISKS RELATEDAFFAIRS OF THE
COMPANY SINCE THE DATE HEREOF OR THAT THE INFORMATION CONTAINED HEREIN IS
CORRECT AS OF ANY DATE SUBSEQUENT TO THE COMPANY
Strategy for Future Acquisitions; Limited Operating History; Need for
Substantial Additional Capital
The Company's current business strategy is to act aggressively in
making acquisitions in the specialty insurance industry and the business
outsourcing services industry. In October 1996, the Company completed two
acquisitions (the "Merger Transactions") pursuant to which it acquired Century
Surety Company ("CSC") and its subsidiaries (together with CSC, the "CSC
Group"), which includes three insurance companies, and Commercial Surety
Agency, Inc. d/b/a Century Surety Underwriters ("CSU"), an insurance agency
that markets surety bonds. In addition, the Company acquired Environmental &
Commercial Insurance Agency, Inc. ("ECI") in November 1996, SMR & Co. Business
Services, Inc. (formerly known as SMR & Co., "SMR") in December 1996, Midwest
Indemnity Corporation ("Midwest") in January 1997, Midland Consultants, Inc. in
February 1997, M&N Risk Management, Inc., M&N Enterprises, Inc. and Millisor
Firmco, Inc. (collectively, the "M&N Companies") in March 1997 and The Benefits
Group Agency, Inc., Network Plus, Inc., Next, Inc. and Surety Associates Ltd.
in April 1997. Accordingly, the Company has no operating history with regard
to a significant portion of its current operations. The financial position and
results of operations of the Company will depend to a large extent on the
Company's ability to integrate these and subsequently acquired operations
effectively. As the Company continues to pursue its acquisition strategy in
the future, its financial position and results of operations may fluctuate
significantly from period to period.
In December 1996, the Company received approximately $27.6 million in
net proceeds from the offering (the "December Private Placement") of 3,251,888
units of the Company (the "Units"). Each Unit consisted of one share of Common
Stock of the Company and one warrant to purchase one share of Common Stock of
the Company at an exercise price of $11.00 per share. In April 1997, the
Company received an additional estimated $5.2 million in net proceeds, from the
private placement of an additional 616,611 Units (the "April Private Placement"
and, together with the December Private Placement, the "Private Placement").
The proceeds received from the Private Placement have been and will be used to
finance acquisitions. Future acquisitions, however, may require additional
equity and debt financing, although neither form of financing is contemplated
at this time. In the event the Company is required to seek additional
financing, there is no assurance that such additional financing will be
available or, if it is available, that it will be available on terms acceptable
to the Company.
Risks Related to Growth Through Acquisitions; Failure to Manage Growth
The Company intends to continue its internal growth and to pursue an
aggressive acquisition strategy. Internal growth may place a significant strain
on the Company's management, operating and technical resources, while growth
through acquisitions will involve substantial risks, including the risk of
improper valuation of the acquired businesses and the risks inherent in
integrating such businesses with the Company's operations. The Company's
acquisition strategy depends on its ability to identify and acquire appropriate
specialty insurance companies and business outsourcing services companies, to
integrate the acquired operations effectively, and to increase its market
share. A number of the Company's competitors for such acquisitions are larger,
better known companies than the Company and have significantly greater financial
resources. There can be no assurance that the Company will be able to locate
acquisition candidates in geographic markets or on terms the Company deems
attractive, that any identified candidates will be acquired, that the Company
will be able to profitably manage acquired companies, or that future
acquisitions will produce financial returns that justify the investment or that
are comparable to the Company's past returns. The completion of acquisitions
requires the expenditure of sizable amounts of capital, as well as management's
time and attention, and the intense competition among companies pursuing
similar acquisition strategies may increase capital requirements. There can be
no assurance that
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6
management skills and systems currently in place will be adequate to implement
the Company's acquisition strategy. The failure to manage growth effectively,
or to implement its acquisition strategy, could have a material adverse effect
on the Company's results of operations and financial condition.
Risks Associated with Acquisitions
Although the Company investigates each business that it acquires,
there may be liabilities that the Company fails or is unable to discover. The
Company seeks to minimize the impact of any such liabilities by obtaining
indemnities and warranties from the seller of the business, which may be
supported by deferring payment of a portion of the purchase price. However,
these indemnities and warranties, if obtained, may not fully cover the
liabilities due to the limited scope of the indemnities, the amount or duration
of the indemnities, the financial limitations of the indemnitor or warrantor,
or other reasons.
Dependence on Key Personnel
The Company depends and will continue to depend in the foreseeable
future on the services of Messrs. Michael G. DeGroote, Edward F. Feighan,
Craig L. Stout, Roswell P. Ellis, Douglas R. Gowland and certain of its other
officers and key employees with extensive experience and expertise in the
insurance specialty industry and the waste and environmental services industry.
In addition, with respect to its provision of business services, the Company is
dependent on the services of Messrs. Gregory J. Skoda, Michael L. Minotti,
Keith W. Reeves, Patrick T. Carney, Terry L. Silver and certain of its other
key personnel with extensive experience and expertise in such industry. The
ability of the Company to retain its officers and key employees is important to
the success of the Company. The loss of key personnel, whether by resignation
or otherwise, could have a material adverse effect on the Company. The Company
does not maintain key personnel insurance on any of its officers or employees.
Possible Depressing Effect of Future Sales of Common Stock
No predictions can be made as to the effect, if any, that future sales
of the Shares, the availability of Common Stock for sale or the perception that
such sales could occur will have on the prevailing market price of the Common
Stock.
The Company has registered for sale, from time to time on a continuous
basis under this registration statement and the registration statement dated
January 17, 1997, by certain Selling Stockholders an aggregate of approximately
37,492,215 million shares of Common Stock (including the shares registered
hereunder). Future sales of such shares, or the perception that such sales
could occur, could adversely affect the market price of the Common Stock.
There can be no assurance as to when, and how many of, such shares will be sold
and the effect such sales may have on the market price of the Common Stock. In
addition, the Company intends to issue Common Stock and options and warrants to
purchase shares of Common Stock in connection with future acquisitions.
Although such securities are or will be, as the case may be, subject to
restrictions on resale in accordance with the Securities Act and the
regulations promulgated thereunder, as such restrictions lapse or if such
shares are registered for sale to the public, such securities may be sold into
the public market. In the event of the issuance and subsequent resale of a
substantial number of shares of Common Stock, or a perception that such sales
could occur, there could be a material adverse effect on the prevailing market
price of the Common Stock.
Dilution
The issuance of additional shares of Common Stock upon exercise of
outstanding warrants or options, or upon the Company's completion of any
acquisitions and business combinations, may have a dilutive effect on earnings
per share and will have a dilutive effect on the voting rights of the holders
of Common Stock.
No Cash Dividends
The payment and level of dividends on Common Stock are subject to the
discretion of the Board of Directors of the Company. The payment of dividends
will depend upon business decisions that will be made by
6
7
the Board of Directors of the Company from time to time based upon the results
of operations and financial conditions of the Company and its subsidiaries and
such other considerations as the Board of Directors considers relevant. In
addition, the Company's credit facility currently prohibits payment of
dividends and other distributions to the stockholders of the Company. Since
becoming a public company in April 1995, the Company has not paid cash
dividends on its Common Stock and the Company's Board of Directors does not
anticipate paying cash dividends in the foreseeable future. The Company
currently intends to retain future earnings to finance the ongoing operations
and growth of the business.
RISKS RELATED TO THE PROVISION OF INSURANCE AND BONDING SERVICES
Inadequate Pricing Risk
The primary risk of any insurance enterprise is the risk of inadequate
pricing, which is a problem that manifests itself in the form of an
unexpectedly high level of claims after policy issuance. The Company utilizes a
variety of actuarial and qualitative methods to set price levels. Ultimately,
however, pricing depends upon an evaluation of prior experience as a predictor
of future experience. Events or trends that have not occurred in the past may
not be anticipated for the future and, therefore, could result in inadequate
pricing leading to elevated levels of losses. Such losses, if they were to
occur, could have a material adverse effect on the financial condition of the
Company.
Unanticipated Losses Due to Inadequate Reserve Estimates
When claims are made, the ultimate amount of liability cannot be
determined until claims are paid to the satisfaction of the insured or until
litigation finally determines liability in disputed cases. Since the process of
litigation and settlement can continue for years, the Company can only assess
its ultimate liability (and the ultimate expense of litigating disputed issues)
by estimation. These estimates, or reserves for losses and loss adjustment
expense (which, as of March 31, 1997, were $42.3 million) are, like prices,
determined by a variety of actuarial and qualitative methods based on prior
experience. There can be no assurance that such reserves will be sufficient to
cover the ultimate liabilities of the Company for policy and bond exposures.
The Company uses a reserving system which it believes will enable it
to meet claims obligations. Due to the nature of some of the coverages written,
claims may be presented which may not be settled for many years after they are
incurred; thus, subjective judgments as to the ultimate exposure to losses are
an integral and necessary component of the loss reserving process. The Company
regularly reviews reserves, using a variety of statistical and actuarial
techniques to analyze current claim costs, frequency and severity data, and
prevailing economic, social and legal factors. Reserves established in prior
years are adjusted as dictated by changes in loss experience and as new
information becomes available. An integral part of the reserving policy of the
Company includes a reserve for incurred but not reported ("IBNR") claims. There
can be no assurance that the assumptions upon which reserves are based are
valid or will be valid in the future.
To help assure the adequacy of its IBNR reserves and individual case
reserves, the Company submits to an annual review by professional actuaries who
test reserve adequacy with a variety of sophisticated mathematical models. In
recent years, such actuaries have certified that reserve levels of the Company
are adequate. There can be no assurance, however, that the modeling techniques
of these actuaries will correctly forecast the adequacy of the Company's
reserves.
The inadequacy of reserves may result in unanticipated losses which
could have a material adverse effect on the financial condition of the Company.
Competition
Both the property and casualty and the surety industries have been
highly competitive in recent years resulting in the consolidation of some of
the industries' largest companies. Competition is particularly acute for
smaller, specialty carriers like the Company because the market niches
exploited by the Company are small and can be penetrated by a larger carrier
that elects to cut prices or expand coverage. The Company's insurance
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8
subsidiaries have endured this risk historically by maintaining a high level of
development of new products, such as its environmental coverage and landfill
bonds eschewed by most major carriers. Nevertheless, there can be no assurance
that future development efforts will succeed or that product erosion from
intensifying competition will not outpace development efforts.
Expansion of Insurance Liability Due to Law Changes; Governmental Regulation
The Company is vulnerable to both judicial and legislative law changes
with respect to its insurance and bonding business. Judicial expansion of terms
of coverage can increase risk coverage beyond levels contemplated in the
underwriting and pricing process. Judicial imposition of pollution liability on
insurers before the era of specific pollution exclusions in insurance policies
created an estimated $25 billion liability, according to industry estimates
reported by A.M. Best, a leading rating agency of insurance companies and
reinsurers, for U.S. insurers and reinsurers that such companies did not know
they were underwriting and for which they received no premium.
At the same time, coverages that are established by statute may be
adversely affected by legislative or administrative changes of law. Most
surety bonds exist because they are required by government agencies. When
governments change the threshold for requiring surety, the market for surety
bonds is directly affected. The repeated postponement by the U.S.
Environmental Protection Agency ("EPA") of deadlines for compliance with the
financial assurance portions of the Resource Conservation and Recovery Act of
1976, as amended ("RCRA"), Subtitle D has significantly slowed growth of the
Company's landfill closure bond program, which was begun in March 1994 because
of the anticipated deadline of April 1994 for universal compliance. Such
compliance currently is not anticipated to be universally enforced until later
in 1997.
Inadequate Reinsurance Protection of Insurance Liabilities
The Company depends heavily on reinsurers to assume a substantial
portion of the exposures underwritten by it. Failure by one or more reinsurers
(which are assuming risks from many sources over which the Company has no
control) could have a material adverse effect on the Company's performance,
since the Company would then be obligated to pay the failed reinsurer's portion
of losses. Moreover, the adequacy of reinsurance, even assuming the solvency of
all reinsurers, is a matter of estimation. As with pricing and reserving,
procurement of reinsurance is premised upon assumptions about the future based
upon past experience. Unanticipated events or trends could produce losses
inadequately covered by reinsurance.
Market Reverses in Invested Asset Portfolio
Investment of the Company's assets to balance its reserves and surplus
is critical to the maintenance of the Company's solvency and profitability. The
Company believes that many insurance companies earn far more in investment
returns on their portfolio assets than they do from underwriting; and many
companies actually underwrite at a loss to develop premium balances, hence
portfolio assets, for investment as evidenced by the number of insurers
operating at combined ratios in excess of 100%. The Company maintains an
investment policy of investing primarily in debt instruments of government
agencies and corporate entities with quality ratings of AA or better, and of
diversifying investments sufficiently to minimize the risk of a substantial
reverse or default in any one investment. These policies are articulated by a
written policy statement and overseen by a formal investment committee of
senior company officials. The Company also employs professional investment
advisers to counsel it with respect to its insurance and bonding operations on
matters of policy as well as individual investment transactions, although these
advisers have no discretionary authority to deploy the Company's assets.
Notwithstanding these measures, an aggregation of serious reverses or defaults
in the investment portfolio could have a material adverse effect on the
earnings and financial condition of the Company.
Federal Income Taxes
The Company accounts for federal income taxes in accordance with
Statement of Financial Accounting Standards No. 109. The Company has reduced
the deferred tax asset by a valuation allowance of CSC Group because the
Company believes it is more likely than not that some portion of the deferred
asset would not be
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9
realized. In reaching the Company's determination of the need to provide a
deferred tax valuation allowance, management considered all available evidence,
both positive and negative, as well as the weight and importance given to such
evidence. The factors the Company relied upon in determining the need for the
valuation allowance are that the CSC Group has a history of significant
portions of their taxable income coming from non-recurring transactions, as
well as the risks that CSC Group has in the areas of product pricing, reserves,
niche market competition and adequacy of reinsurance.
RISKS RELATED TO THE PROVISION OF BUSINESS OUTSOURCING SERVICES
Competition
The business outsourcing services industry has been highly competitive
in recent years resulting in the consolidation of many companies and strategic
alliances across industry lines. The principal competitive factors in this
industry are service and price. Competition is particularly acute for small to
medium sized providers because larger providers or strategic alliances with
larger providers can create service and price distortions in the market place.
The Company's business outsourcing services subsidiaries have historically
endured these risks by maintaining a high level of development of new services.
There can be no assurance that future development efforts will succeed or that
intensifying competition will not outpace development efforts.
Regulations
The Company is vulnerable to legislative law changes with respect to
its provision of tax advisory, compliance and preparation services. Legislative
changes may expand or contract the types and amounts of business services that
individuals and businesses require. There can be no assurance that future laws
will provide the same or similar opportunities to provide business consulting
and management services to individuals and businesses that the current laws
provide.
RISKS RELATED TO THE PROVISION OF ENVIRONMENTAL SERVICES
Consents of Regulatory Authorities
In October 1996, the Ohio attorney general's office determined that
the Merger Transactions constituted a change of ownership of Ohio Environmental
Protection Agency ("Ohio EPA") permitted facilities owned by Republic
Environmental Systems (Cleveland) Inc. ("RES (Cleveland)") and Republic
Environmental Systems (Ohio), Inc. ("RES (Ohio)"). In addition, the Ohio EPA
may determine that the Merger Transactions constitute a modification of such
permits. As a result, Ohio law requires that the change of ownership of the
permitted facilities, as well as the permit modifications, if any, be approved
by the director of the Ohio EPA, based upon the disclosure statements and an
investigative report prepared by the Ohio attorney general's office. The
Company consummated the Merger Transactions prior to receipt of the requisite
approval of the director of the Ohio EPA as permitted by applicable law. During
the approval process, the Company does not anticipate that the operations at
such facilities will be affected. In the event that the director of the Ohio
EPA ultimately disapproves such change of ownership or, if required, such
permit modifications, the Company would be required to effect the negation of
the change of ownership of such facilities. The negation could be accomplished
through the restoration of the original ownership structure of such facilities,
the disposition of the facilities or another means that complies with the
requirements of applicable law. The failure to obtain approval of such change
of ownership or permit modifications, if any, could have a material adverse
effect on the financial condition and operations of the Company.
Regulation
The transportation and disposal of solid and chemical wastes and
rendering of related environmental services are subject to federal, state,
provincial and local requirements which regulate health, safety, the
environment, zoning and land-use. Operating permits are generally required for
treatment, storage and disposal facilities ("TSD Facilities") and certain
transportation vehicles, and these permits are subject to revocation,
modification and renewal. Federal, state, provincial and local regulations
vary, but generally govern waste
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management activities (including final disposal), the location and use of
facilities and also impose restrictions to prohibit or minimize air and water
pollution. In addition, governmental authorities have the power to enforce
compliance with these regulations and to obtain injunctions or impose fines in
the case of violations, including criminal penalties. These regulations are
administered by the EPA and various other federal, state, provincial and local
environmental and health and safety agencies and authorities, including the
Occupational Safety and Health Administration of the U.S. Department of Labor.
In addition, certain of the Company's operations are regulated under applicable
laws and regulations in Canada.
The Company believes that in the existing climate of heightened legal,
political and citizen awareness and concerns, companies in the hazardous waste
and environmental services industry, including the Company, may be faced with
material fines and penalties and the need to expend funds for remedial work and
related activities at TSD Facilities. The Company has established a reserve
(which, as of March 31, 1997 was approximately $2.3 million) to cover such
fines, penalties and costs which the Company's management believes will be
adequate. Further, in connection with the acquisition of certain TSD
Facilities, the Company has been indemnified against certain environmental
liabilities. While such amounts expended in the past or anticipated to be
expended in the future have not had and are not expected to have a materially
adverse effect on the Company's financial condition or operation, the
possibility remains that technological, regulatory or enforcement developments,
the results of environmental studies or other factors could materially alter
this expectation and despite such reserves and indemnification obligations,
could adversely affect the Company's operating results.
The Company's operation of TSD Facilities subjects it to certain
operating, monitoring, site maintenance and closure obligations. In order to
construct, expand and operate a TSD Facility, one or more construction or
operating permits, as well as zoning approvals, must be obtained. These
construction and operating permits and zoning approvals are difficult and
time-consuming to obtain, and the issuance of such permits and approvals often
is opposed by neighboring landowners and local and national citizens' groups.
Once obtained, the operating permits may be subject to periodic renewal and are
subject to modification and revocation by the issuing agency. In connection
with the Company's acquisition of TSD Facilities, it often may be necessary to
expend considerable time, effort and money to bring the acquired facilities
into compliance with applicable requirements and to obtain the permits and
approvals necessary to increase their capacity. The failure of the Company to
renew existing permits or obtain newly required permits could adversely affect
the Company's operating results. In addition, the Company's waste
transportation obligations are subject to evolving and expanding laws and
regulations that may impose additional monitoring, training and safety
requirements.
Governmental authorities have the power to enforce compliance with
regulations and permit conditions and to obtain injunctions or impose fines in
case of violations. Citizens' groups may also bring suit for alleged
violations. During the ordinary course of its operations, the Company has from
time to time received citations or notices from such authorities that its
operations are not in compliance with applicable environmental or health or
safety regulations. Upon receipt of such citations or notices, the Company
works with the authorities to attempt to resolve the issues raised. Failure to
correct the problems to the satisfaction of the authorities could lead to
monetary or criminal penalties, curtailed operations or facility closure any of
which could have a material adverse effect on the Company's business and
financial condition.
Subtitle D of RCRA establishes a framework for regulating the disposal
of non-hazardous solid wastes. In the past, the Subtitle D framework has left
the regulation of non-hazardous waste disposal largely to the states. On
October 9, 1991, however, the EPA promulgated a final rule which imposes
minimum federal comprehensive solid waste management criteria and guidelines
including location restrictions, facility design and operating criteria,
closure and post- closure requirements, financial assurance standards,
groundwater monitoring requirements and corrective action standards. Because
some parts of the new regulations will be phased in over time, the full effect
of these regulations may not be felt for several years. However, other than for
groundwater monitoring and financial assurance requirements, all provisions of
the final rule became effective October 9, 1993. Operating and design criteria
for existing operations may have to be modified to comply with these new
regulations. In addition, new requirements applicable to the disposal of
non-hazardous solid waste may be adopted
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when reauthorization of RCRA is taken up by Congress and the Company cannot
predict the effect of such new requirements.
Possibility of Liability for Hazardous Substance Remediation and Damages
With very limited exceptions, federal law imposes joint and several
liability upon present and former owners and operators of facilities that
release "hazardous substances" into the environment and the generators and
transporters of those substances, regardless of the care exercised by such
persons and regardless of when the hazardous substance is first detected in the
environment. All such persons may be liable for the costs of waste site
investigation, waste site cleanup and damages to natural resources. There is an
inherent industry risk of liability arising from the release of "hazardous
substances" into the environment, notwithstanding safety and other measures
taken by the Company and other owners or operators of facilities. In addition,
because the term "hazardous substance" is very broadly defined under applicable
federal law, "hazardous substances" or "hazardous wastes" may have been
deposited in properties with which the Company has been, or will become,
associated as an owner or operator. Moreover, waste collection companies
acquired by the Company have transported hazardous waste in the past and will
do so in the future, and some of the Company's operations may generate small
amounts of hazardous waste. As a result of the foregoing, the Company may face
claims for remediation of environmental contamination, personal injury or
damage to natural resources at sites with which it is, or has been, associated
as owner, operator, transporter or waste generator and from which there is a
release or threatened release of hazardous substances which causes the
incurrence of response costs and damages. Costs for remediation of, and damages
for, environmental contamination can be very substantial. Given the limitations
in insurance coverage for these risks, such liability could have a material
adverse effect on the Company's business and consolidated financial condition.
Legal Proceedings
The Company is a party to various legal and environmental proceedings
which have arisen in the ordinary course of its business. No assurance can be
given with respect to the outcome of these legal proceedings and the effect
such outcomes may have on the Company.
Lack of Environmental Liability Insurance
The majority of the Company's domestic locations currently carry
site-specific pollution legal liability insurance, which may provide coverage
under certain circumstances for pollution damage to third parties. In addition,
the Company's domestic contracting operations carry contractors' pollution
liability insurance, which may provide coverage under certain circumstances for
damage to third parties. However, both of these coverages are restrictive in
nature, as they are subject to certain exclusions and effective dates,
consistent with insurance industry requirements. In addition, such coverage is
subject to specific and aggregate limits which may not be sufficient to cover
claims, if they should arise.
In prior years, consistent with industry trends, the Company was not
able to obtain pollution insurance at reasonable costs and, therefore, carried
only such coverage as was required by regulatory permits. In addition, the
extent of insurance coverage under certain forms of policies has been the
subject in recent years of litigation in which insurance companies have, in
some cases, successfully taken the position that certain risks are not covered
by such policies. If, in the absence of such insurance, the Company were to
incur liability for environmental damages of sufficient magnitude, it could
have a material adverse effect on the Company's business and consolidated
financial condition.
Competition
The hazardous waste industry is highly competitive. Entry and ongoing
operations require substantial technical, managerial and financial resources.
The Company competes with large national companies and with regional and local
companies, some of which have significantly greater financial resources and
more established market positions than the Company.
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THE COMPANY
The Company is a diversified services company which, acting through
its subsidiaries, provides business outsourcing services, specialty insurance
services and waste and environmental services. In October 1996, the Company
completed the Merger Transactions. Through the Company's insurance
subsidiaries, the Company provides specialty insurance and bonding to small and
medium sized commercial enterprises in over forty states throughout the United
States.
In December 1996, the Company completed the acquisition of SMR.
Through SMR, the Company provides business consulting and management services
in the areas of tax planning, tax return preparation and compliance, computer
consulting, outsourcing, employee benefit program design and administration,
and human resource management to individuals and small and medium sized
commercial enterprises primarily in Ohio.
In February 1997, the Company signed a non-binding letter of
intent and confidentiality agreement (collectively, the "Letter of Intent") to
sell the Company's environmental services operations. The Letter of Intent
also contemplates the formation of a strategic alliance between the Company and
the purchaser whereby the Company will continue to have access to the Company's
environmental resources for the benefit of its insurance customers after the
sale. The Company anticipates that the sale will be completed by mid-1997.
Consummation of the transaction remains subject to the purchaser's due
diligence, the negotiation and execution of definitive documentation and the
receipt of necessary governmental and third party approvals and consents.
Accordingly, there can be no assurance that the transaction will be
consummated.
The Company's strategy is to aggressively grow as a diversified
services company by expanding its recently acquired business outsourcing
services and specialty insurance operations through internal growth and
additional acquisitions in such industries.
The Company was formed as a Delaware corporation in 1987 under the
name Stout Environmental, Inc. In 1992, the Company was acquired by Republic
Industries, Inc. ("RII"). In April 1995, RII effected a spin-off of its
hazardous waste operations through a distribution of the Common Stock of the
Company to the stockholders of record of RII (the "Spin-off"). In connection
with the Merger Transactions, in October 1996, the Company changed its name to
International Alliance Services, Inc. from Republic Environmental Systems, Inc.
The Company's Common Stock trades on Nasdaq under the trading symbol "IASI."
The principal executive office of the Company is located at 10055
Sweet Valley Drive, Valley View, Ohio, 44125 and its telephone number is (216)
447-9000.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
Shares offered hereby. The Company will bear all expenses incident to the
registration of the Shares under federal and state securities laws and the sale
of the Shares hereunder, other than expenses incident to the delivery of the
Shares to be sold by Selling Stockholders, including any transfer taxes payable
on any Shares and any commissions and discounts payable to underwriters, agents
or dealers. See "Plan of Distribution."
SELLING STOCKHOLDERS
The following table sets forth the name of each Selling Stockholder,
the number of shares of Common Stock beneficially owned by each Selling
Stockholder as of May 15, 1997, the number of Shares registered hereby that
each Selling Stockholder may offer and sell pursuant to this Prospectus.
However, because the Selling Stockholders may offer all or a portion of the
Shares at any time and from time to time after the date hereof, the exact
number of Shares that each Selling Stockholder may retain upon completion of
the Offering cannot be determined at this time. To the knowledge of the
Company, none of the Selling Stockholders has had any
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material relationship with the Company except as set forth in the footnotes to
the following table and as more fully described elsewhere in this Prospectus
(including the information incorporated by reference in this Prospectus).
OWNERSHIP
NUMBER OF SHARES TO AFTER THE OFFERING (1)
OWNERSHIP BE OFFERED FOR THE ----------------------
PRIOR TO THE SELLING STOCKHOLDER'S NUMBER PERCENT
SELLING STOCKHOLDER OFFERING ACCOUNT OF SHARES OF CLASS
------------------- -------- ------- --------- --------
American National Bank & Trust Co.
Of Chicago . . . . . . . . . . . . . 20,008 20,008 0 *
Marjorie Boyas . . . . . . . . . . . 10,000 1,500 8,500 *
Michael Boyas . . . . . . . . . . . . 101,277 15,191 86,086 *
Nicholas Boyas . . . . . . . . . . . 10,772 1,615 9,157 *
Pete Boyas . . . . . . . . . . . . . 1,250,565 187,585 1,062,980 3.0%
Ronnie Boyas . . . . . . . . . . . . 4,311 646 3,665 *
Stacey Boyas . . . . . . . . . . . . 101,277 15,191 86,086 *
Tony Boyas . . . . . . . . . . . . . 101,277 15,191 86,086 *
Joan Carney . . . . . . . . . . . . . 75,000 (2) 19,350 (2) 55,650 *
William F. Comiskey, Jr. . . . . . . 117,174 37,017 80,157 *
Michael G. DeGroote(3) . . . . . . . 14,247,112 (4) 1,111,112 (5) 13,136,000 (6) 31.3%
Roswell P. And Shirley Sue Ellis(7) . 82,500 82,500 0 *
Edward F. Feighan(8) . . . . . . . . 584,000 87,600 496,400 1.4%
Harve A. Ferrill(9) . . . . . . . . 13,000 (10) 11,000 (11) 2,000 (12) *
First Premium Services, Inc. . . . . 26,210 26,210 0 *
Whitney L. Hubbs . . . . . . . . . . 1,159 385 774 *
Indiana Lumbermens Mutual Ins. Co. . 45,903 45,903 0 *
Charles King . . . . . . . . . . . . 362,780 54,416 308,364 *
Kenneth A. Lanci . . . . . . . . . . 102,216 15,333 86,883 *
Kenneth & Davie LaVan . . . . . . . . 1,119,177 167,877 951,300 2.6%
Arlene M. LoConti(13) . . . . . . . . 707,987 106,198 601,789 1.8%
Joseph A. LoConti . . . . . . . . . . 618,403 92,760 525,643 1.5%
Joseph E. LoConti((14) . . . . . . . 1,752,000 262,800 1,489,200 4.1%
LoConti Family Trust(15) . . . . . . 1,536,800 230,520 1,306,280 3.6%
Geraldine L. Longo . . . . . . . . . 53,986 9,652 44,334 *
Saverio J. Longo . . . . . . . . . . 22,029 7,335 14,694 *
Midwest Indemnity Corp. . . . . . . . 138,655 138,655 0 *
Kenneth R. Millisor . . . . . . . . . 585,000 (16) 193,050 (16) 391,950 1.1%
Anna Marie Minotti . . . . . . . . . 472,500 (17) 121,905 (17) 350,595 1.0%
Lea Boyas Morabito . . . . . . . . . 101,277 15,191 86,086 *
National American Insurance Co. . . . 176,470 176,470 0 *
Steven M. Nobil . . . . . . . . . . . 315,000 (18) 103,950 (18) 211,050 *
Patan Rock, Inc. . . . . . . . . . . 408,800 61,320 347,480 *
Mark Perkins . . . . . . . . . . . . 27,500 27,500 0 *
Rochelle Reeves . . . . . . . . . . . 463,500 (19) 119,583 (19) 343,917 *
Richard C. Rochon(20) . . . . . . . 111,110 (21) 111,110 (22) 0 *
Joseph R. Rutigliano . . . . . . . . 102,216 15,333 86,883 *
David J. Sgro . . . . . . . . . . . . 98,900 12,075 86,825 *
David M. Sgro . . . . . . . . . . . . 8,600 1,050 7,550 *
Patricia Skoda(23) . . . . . . . . . 781,000 (24) 169,872 (24) 611,128 1.7%
Sophia Management Ltd(25). . . . . . 5,825,000 1,029,750 4,795,250 13.3%
Craig L. Stout(26) . . . . . . . . . 817,600 122,640 694,960 1.9%
Joseph and Juanita Tartabini
Charitable Trust . . . . . . . . . . 1,361,665 204,250 1,157,415 3.2%
Christopher Timm . . . . . . . . . . 82,500 82,500 0 *
Felicia P. Young . . . . . . . . . . 233,600 35,040 198,560 *
------- ------ -------
Total . . . . . . . . . . . . . 35,177,816 5,366,139 29,811,677 71.5%
========== ========= ========== ======
- -------------------------
*less than one percent
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(1) The information contained in the table above includes shares of Common
Stock that the Selling Stockholder has the right to acquire within 60
days through the exercise of any option or warrant and excludes shares
of Common Stock and options or warrants to purchase shares of Common
Stock held of record by other parties.
(2) Includes 14,850 shares of Common Stock issuable upon exercise of
outstanding warrants.
(3) Mr. DeGroote has served as Chairman of the Board and a Director of the
Company since April 1995. Mr. DeGroote served as President and Chief
Executive Officer of the Company from April 1995 until October 1996.
Mr. DeGroote also served as Chairman of the Board, President and
Chief Executive Officer of Republic Industries, Inc. from May 1991
until August 1995.
(4) Consists of 7,751,556 shares of Common Stock owned of record by
Westbury (Bermuda) Ltd., successor-in-interest to MGD Holdings
("Westbury"), and 6,495,556 shares of Common Stock that Westbury has
the right to acquire upon exercise of outstanding warrants.
(5) Includes 555,556 shares of Common Stock issuable upon exercise of
outstanding warrants.
(6) Consists of 7,196,000 shares of Common Stock owned of record by
Westbury and 5,940,000 shares of Common Stock that Westbury has the
right to acquire upon exercise of outstanding warrants.
(7) Ms. Ellis is the wife of Roswell P. Ellis, the Senior Vice President -
Insurance Group of the Company since March 1997.
(8) Mr. Feighan has served as Chief Executive Officer, President and a
Director of the Company since October 1996.
(9) Mr. Ferrill has served as a Director of the Company since October
1996.
(10) Consists of 7,500 shares of Common Stock owned of record by The Harve
A. Ferrill Trust U/A 12/31/69 and 5,500 shares of Common Stock
issuable upon exercise of outstanding warrants.
(11) Includes 5,500 shares of Common Stock issuable upon exercise of
outstanding warrants.
(12) Owned of record by The Harve A. Ferrill Trust U/A 12/31/69.
(13) Ms. LoConti is the mother of Joseph E. LoConti. See Footnote 14.
(14) Mr. LoConti served as Vice Chairman and a Director of the Company from
April 1995 until March 1997. Mr. LoConti has entered into a
Representation Agreement with the Company under which Mr. LoConti will
continue to provide his exclusive services to the Company.
(15) Joseph E. LoConti serves as trustee. See Footnote 14.
(16) Includes 193,050 shares of Common Stock issuable upon exercise of
outstanding warrants.
(17) Includes 93,555 shares of Common Stock issuable upon exercise of
outstanding warrants.
(18) Includes 103,950 shares of Common Stock issuable upon exercise of
outstanding warrants.
(19) Includes 91,773 shares of Common Stock issuable upon exercise of
outstanding warrants.
(20) Mr. Rochon has served as a Director of the Company since October 1996.
(21) Consists of 111,110 shares of Common Stock owned of record by WeeZor I
Limited Partnership, a limited partnership controlled by Mr. Rochon,
and includes 55,555 shares of Common Stock issuable upon exercise of
outstanding warrants.
(22) Includes 55,555 shares of Common Stock issuable upon exercise of
outstanding warrants.
(23) Ms. Skoda is the wife of Gregory J. Skoda, the Executive Vice
President and Chief Financial Officer of the Company since December
1996.
(24) Includes 96,822 shares of Common Stock issuable upon exercise of
outstanding warrants.
(25) Mssrs. Joseph E. LoConti, Craig L. Stout, Edward F. Feighan and
Gregory J. Skoda are managers of Sophia Management Ltd. See
Footnotes 8, 14, 23 and 26.
(26) Mr. Stout has served as Chief Operating Officer and a Director of the
Company since October 1996.
PLAN OF DISTRIBUTION
The Shares may be sold or distributed from time to time by or for the
account of the Selling Stockholders, or their pledgees on behalf of the Selling
Stockholder, in transactions (which may involve crosses and block transactions)
on Nasdaq or any national securities exchange or U.S. inter-dealer quotation
system of a registered national securities association on which the Shares are
then listed, in the over-the-counter market, in one or more privately
negotiated transactions (including sales pursuant to pledges), through the
writing of options on the Shares, in a combination of such methods of
distribution or by any other legally available means. This Prospectus also may
be used, with the Company's consent, by donees of the Selling Stockholders, or
by other persons acquiring Shares and who wish to offer and sell such Shares
under circumstances requiring or making desirable its use. Such methods of sale
may be conducted by the Selling Stockholders at market prices prevailing at the
time of sale, at prices related to such prevailing market prices or at prices
otherwise negotiated. The Selling Stockholders may effect such transactions
directly, or indirectly through broker-dealers or agents acting on their behalf
and, in connection with such sales, such broker-dealers or agents may receive
compensation in the form of commissions or discounts from the Selling
Stockholders and/or the purchasers of the Shares for whom they may act as agent
or to whom they sell Shares as principal or both (which commissions or
discounts might be in excess of customary commissions). To the extent
required, the Company will file, during any period in which
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offers or sales are being made, one or more supplements to this Prospectus to
set forth the names of donees of Selling Stockholders and any other material
information with respect to the plan of distribution not previously disclosed.
The Selling Stockholders and any such underwriters, brokers, dealers
or agents that participate in such distribution may be deemed to be
"underwriters" within the meaning of the Securities Act, and any discounts,
commissions or concessions received by any such underwriters, brokers, dealers
or agents might be deemed to be underwriting discounts and commissions under
the Securities Act. Neither the Company nor the Selling Stockholders can
presently estimate the amount of such compensation. The Company knows of no
existing arrangements between any Selling Stockholder and any other Selling
Stockholder, underwriter, broker, dealer or other agent relating to the sale or
distribution of the Shares.
Under applicable rules and regulations under the Exchange Act, any
person engaged in a distribution of any of the Shares may not simultaneously
engage in market activities with respect to the Common Stock for a period of
two business days prior to the commencement of such distribution. In addition
and without limiting the foregoing, the Selling Stockholders will be subject to
applicable provisions of the Exchange Act; including without limitation Rule
10b-5 and Regulation M, which provisions may limit the timing of purchases and
sales of any of the Shares by the Selling Stockholders. All of the foregoing
may affect the marketability of the Common Stock.
The Company will not receive any of the proceeds from the sale of the
Shares offered hereby, but will bear all expenses incident to the registration
of the Shares under federal and state securities laws and the sale of the
Shares hereunder other than expenses incident to the delivery of the Shares to
be sold by the Selling Stockholders, including any transfer taxes payable on
any Shares, and any commissions and discounts payable to underwriters, agents
or dealers.
In order to comply with certain states' securities laws, if
applicable, the Shares will be sold in such jurisdictions only through
registered or licensed brokers or dealers. In addition, in certain states the
Common Stock may not be sold unless the Common Stock has been registered or
qualified for sale in such state or an exemption from registration or
qualification is available and is complied with.
LEGAL MATTERS
The validity of the Shares offered hereby will be passed upon for the
Company by Akin, Gump, Strauss, Hauer & Feld, L.L.P. ("Akin Gump"). Mr. Rick L.
Burdick, a partner with Akin Gump, owns 500 shares of Common Stock and warrants
to purchase 12,000 shares of Common Stock.
EXPERTS
The audited consolidated and combined financial statements of the
Company (formerly known as Republic Environmental Systems, Inc.) and its
subsidiaries for the years ended December 31, 1994, 1995 and 1996 incorporated
by reference in this Prospectus and elsewhere in this Registration Statement
have been audited by KPMG Peat Marwick LLP, independent certified public
accountants incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing.
UNCERTAINTY OF FORWARD LOOKING STATEMENTS
Certain statements and information in this Prospectus (including
documents incorporated herein by reference, see "Incorporation of Certain
Documents by Reference") constitute forward-looking statements within the
meaning of the Federal Private Securities Litigation Reform Act of 1995. Such
forward-looking statements are typically punctuated by words or phrases such as
"anticipate," "estimate," "projects," "management believes," "the Company
believes" and words or phrases of similar import. Such statements are subject
to certain risks, uncertainties or assumptions. Should one or more of these
risks or uncertainties materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those anticipated, estimated
or projected. Among the key factors that may have a direct bearing on the
Company's results and financial condition are: (i)
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demand for the Company's services; (ii) the Company's ability to integrate the
operations of acquired businesses; (iii) the Company's ability to expand into
new markets; (iv) the consummation of the Company's disposition of its
environmental services operations; (v) environmental liabilities to which the
Company may become subject in the future which are not covered by an indemnity
or insurance; (vi) the impact of current and future laws and governmental
regulations affecting the Company's operations; (vii) competitive practices in
the specialty insurance and bonding industries; (viii) competitive practices in
the reinsurance markets utilized by the Company's insurance operations; (ix)
judicial, legislative, and regulatory changes of law relating to risks covered
by the Company's insurance operations or to the operations of insurance
companies in general; (x) market fluctuations in the values or returns on
assets in the Company's investment portfolios; (xi) pricing of the Company's
insurance products; and (xii) adverse loss development.
No dealer, salesperson or other person has been authorized to give any
information or to make any representations other than those contained in or
incorporated by reference in this Prospectus in connection with the offer made
by this Prospectus and, if given or made, such information or representations
must not be relied upon as having been authorized by the Company or the Selling
Stockholders. Neither the delivery of this Prospectus nor any sale made
hereunder shall under any circumstances create an implication that there has
been no change in the affairs of the Company since the date hereof. This
Prospectus does not constitute an offer to sell or the solicitation of an offer
to buy any security other than the shares of Common Stock offered hereby, nor
does it constitute an offer to sell or a solicitation of an offer to buy any
shares of Common Stock by anyone in any jurisdiction in which such offer or
solicitation is not authorized, or in which the person making such offer or
solicitation is not qualified to do so, or to any person to whom it is unlawful
to make such offer or solicitation.
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================================================================================
No dealer, salesperson or other person has been authorized to give any
information or to make any representations other than those contained in or
incorporated by reference in this Prospectus in connection with the offer made
by this Prospectus and, if given or made, such information or representations
must not be relied upon as having been authorized by the Company or the Selling
Stockholders. Neither the delivery of this Prospectus nor any sale made
hereunder shall under any circumstances create an implication that there has
been no change in the affairs of the Company since the date hereof. This
Prospectus does not constitute an offer to sell or the solicitation of an offer
to buy any security other than the shares of Common Stock offered hereby, nor
does it constitute an offer to sell or a solicitation of an offer to buy any
shares of Common Stock by anyone in any jurisdiction in which such offer or
solicitation is not authorized, or in which the person making such offer or
solicitation is not qualified to do so, or to any person to whom it is unlawful
to make such offer or solicitation.
------------------DATE HEREOF.
------------------------
TABLE OF CONTENTS
PAGE
----
The Company................................ 3
Use of Proceeds............................ 4
Ratio of Earnings to Fixed Charges......... 4
Description of Debt Securities............. 4
Description of Common Stock................ 7
Description of Warrants.................... 8
Plan of Distribution....................... 8
Legal Matters.............................. 10
Experts.................................... 10
Available Information . . . . . . . . . . 3Information...................... 10
Incorporation of Certain Documents by
Reference . . . . . . . . . . . . . . 4
Risk Factors . . . . . . . . . . . . . . . 5
The Company . . . . . . . . . . . . . . . 12
Use of Proceeds . . . . . . . . . . . . . 12
Selling Stockholders . . . . . . . . . . . 13
Plan of Distribution . . . . . . . . . . . 15
Legal Matters . . . . . . . . . . . . . . 16
Experts . . . . . . . . . . . . . . . . . 16
Uncertainty of Forward
Looking Statements . . . . . . . . . . . . 16Reference................................ 11
5,366,139 SHARES============================================================
============================================================
$125,000,000
INTERNATIONAL ALLIANCE
SERVICES, INC.
DEBT SECURITIES
COMMON STOCK
WARRANTS
------------------------
PROSPECTUS
_____________,------------------------
, 1997
============================================================================================================================================
1813
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14.14 -- OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.DISTRIBUTION
The following table sets forth the estimated expenses, other than underwriting discountsfees and
commissions, payableexpected to be borne by the Registrant in connection with the
issuance and distribution of the securities being registered hereby.registered:
Securities and Exchange Commission Filing Fee . . . . . . . . . . . . . . . . . . . . . . . . . .registration fee......... $ ----------37,879
Blue Sky fees and expenses.................................. 10,000
Trustee fees and expenses................................... 10,000
Legal fees and expenses..................................... 150,000
Printing Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
----------
Legal Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
----------
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
----------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
----------engraving expenses............................. 150,000
Accounting fees and expenses................................ 10,000
Miscellaneous(1)............................................ 12,121
--------
Total(2).......................................... 380,000
========
- ---------------
(1) Includes estimates of Nasdaq listing fees and NASD filing fees.
(2) All amounts listed above are estimates, except for the Securities and
Exchange Commission registration fee.
ITEM 15.15 -- INDEMNIFICATION OF DIRECTORS AND OFFICERS.OFFICERS
Section 145 of the General Corporation Law of the State of Delaware (the
"DGCL") empowers a Delaware corporation to indemnify any person who was or is a
party, or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of such corporation) by
reason of the fact that such person is or was an officer or director of such
corporation, or is or was serving at the request of such corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise. The indemnity may include expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by such person in connection with such action,
suit or proceeding, provided that such 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, with respect to any criminal action or proceeding, had no
reasonable cause to believe such person's conduct was unlawful. A Delaware
corporation may indemnify past or present officers and directors of such
corporation or of another corporation or other enterprise at the former
corporation's request, in an action by or in the right of the corporation to
procure a judgment in its favor under the same conditions, except that no
indemnification is permitted without judicial approval if the officer or
director is adjudged to be liable to the corporation. Where an officer or
director is successful on the merits or otherwise in defense of any action
referred to above, or in defense of any claim, issue or matter therein, the
corporation must indemnify such person against the expenses (including
attorneys' fees) which such person actually and reasonably incurred in
connection therewith. Section 145 further provides that any indemnification
shall be made by the corporation only as authorized in each specific case upon a
determination that indemnification of such person is proper because he has met
the applicable standard of conduct by the (i) stockholders, (ii) board of
directors by a majority vote of a quorum consisting of directors who were not
parties to such action, suit or proceeding, (iii) committee of directors who are
not parties to such action, suit or proceeding designated by majority vote by
such disinterested directors even if less than a quorum, or (iv) independent
legal counsel, if there are no such disinterested directors, or if such
disinterested directors so direct. Section 145 further provides that
indemnification pursuant to its provisions is not exclusive of other rights of
indemnification to which a person may be entitled under any bylaw, agreement,
vote of stockholders or disinterested directors or otherwise.
II-1
14
The Amended and Restated Certificate of Incorporation, as amended, of the
CompanyRegistrant entitles the Board of Directors to provide for indemnification of
directors and officers to the fullest extent provided by law, except for
liability (i) for any breach of the
directors'director's duty of loyalty to the CompanyRegistrant or
its stockholders, (ii) for acts ofor omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) for unlawful
payments of dividends, or for unlawful stock purchases or redemptions, or (iv)
for any transaction from which the director derived an improper personal
benefit.
Article VII of the Amended and Restated Bylaws of the CompanyRegistrant provide
that to the fullest extent and in the manner providedpermitted by the laws of the State
of Delaware and specifically as is permitted under Section 145 of the General Corporation Law
ofDGCL, the
State of Delaware, the CompanyRegistrant shall indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative, other than
an action by or in the right of the Company,Registrant, by reason of the fact that such
person is or was a director, officer, employee or agent of the Company,Registrant, or is
or was serving at the request of the CompanyRegistrant as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise against expenses, including attorneys' fees, judgments, fines and
amounts paid in settlement actually and reasonably incurred in connection with
such action, suit, or proceeding if hesuch person acted in good faith and in a
manner he reasonably believed to be in and not opposed to the best interests of
the Company,Registrant, and with respect to any criminal action or proceeding, hesuch
person had no reasonable cause to believe his conduct was unlawful.
Determination of anyan action, suit, or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that thea person did not act in a good faith and in a
manner which hesuch person reasonably believed to be in and not opposed to the best
interests of the Company,Registrant, and with respect to any criminal action or
proceeding, had reasonable cause to believe that his conduct was lawful.
The Amended and Restated Bylaws provide that any decision as to
indemnification shall be made: (a) by the CompanyBoard of Directors of the Registrant
by a majority vote of a quorum consisting of directors who were not parties to
such action, suit or proceeding; or (b) if such a quorum is not obtainable, or
even if obtainable, if a quorum of disinterested directors so directs, by
independent legal counsel in a written opinion; or (c) by the stockholders. The
Board of Directors of the Registrant may authorize indemnification of expenses
incurred by an officer or director in defending a civil or criminal action, suit
or proceeding in advance of the final disposition of such action, suit or
proceeding. Indemnification pursuant to these provisions is not exclusive of any
other rights to which those seeking indemnification may be entitled under any
bylaw, agreement, vote of stockholders or disinterested directors or otherwise
and shall indemnifycontinue as to a person who has ceased to be a director or officer.
The Registrant may purchase and maintain insurance on behalf of any person who
is or was a director, officer, employee or agent of the Registrant.
Further, the Amended and Restated Bylaws of the Registrant provide that the
indemnity provided will be extended to the directors, officers, employees and
agents of any constituent corporation (including any constituent of a
constituent) absorbed in a consolidation or merger which, if its separate
existence had continued, would have had power and authority to indemnify its
directors, officers, and employees or agents so that any person who is or was a
director, officer, employee or agent of such constituent corporation, or is a party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the Company to procure a
judgment in its favor by reason of the fact that he is or
was serving at the request of such constituent corporation as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, shall stand in the same position under the provisions
of the Amended and Restated Bylaws with respect to the resulting or surviving
corporation as such person would have with respect to such constituent
corporation if its separate existence had continued.
The Registrant does not currently maintain a separate insurance policy
relating to its directors and officers; however, the Registrant is currently
considering purchasing and maintaining an insurance policy under which the
directors and officers of the Registrant would be insured, within the limits and
subject to the limitations of the policy, against certain expenses including attorneys' fees, actually
and reasonably incurred by him in connection
with the defense of certain claims, actions, suits or settlementproceedings, and certain
liabilities which might be imposed as a result of such actionclaims, actions, suits or
suit if he acted in good faith and in a manner he reasonably
believed toproceedings, which may be inbrought against them by reason of being or not opposed to the best interests of the Company, except
that no indemnification shall be made in respect of any claim, issuehaving been
such directors or matter
as to which such person shall have been adjudged to be liable for negligence or
misconduct in the performance of his duty to the Company unless the court
orders otherwise.
II-1officers.
II-2
1915
ITEM 16.16 -- EXHIBITS
The following exhibits are filed as part of this Registration
Statement:
EXHIBIT NUMBER EXHIBIT DESCRIPTION
4.1* -- Form of Stock Certificate of Common Stock of the Company
(filed as Exhibit 4.1 to the Company's Registration
Statement on Form 10, file no. 0-25890, and incorporated
herein by reference).
5.1** -- Opinion of Akin, Gump, Strauss, Hauer & Feld, L.L.P.
23.1 -- Consent of KPMG Peat Marwick LLP.
23.2** -- Consent of Akin, Gump, Strauss, Hauer & Feld, L.L.P.
(included in its opinion filed as Exhibit 5.1).
24.1 -- Powers of Attorney (included on the signature pages
attached hereto).
EXHIBIT
NUMBER DESCRIPTION
------- -----------
*4.1 -- Amended and Restated Certificate of Incorporation of the
Registrant (filed as Exhibit 3.1 to Registration
Statement on Form 10, Commission File No. 000-25890 and
incorporated herein by reference)
*4.2 -- Certificate of Amendment to the Amended and Restated
Certificate of Incorporation of the Registrant (filed as
Exhibit 3.2 to Annual Report on Form 10-K for the fiscal
year ended December 31, 1996, Commission File No.
000-25890 and incorporated herein by reference)
*4.3 -- Amended and Restated Bylaws of the Registrant (filed as
Exhibit 3.2 to Registration Statement on Form 10,
Commission File No. 000-25890 and incorporated herein by
reference)
*4.4 -- Form of Indenture for Debt Securities (filed as Exhibit
4.4 to Registration Statement on Form S-3, Commission
File No. 333-40331 and incorporated herein by reference)
*4.5 -- Form of Debt Security (included in Exhibit 4.4 (filed as
Exhibit 4.4 to Registration Statement on Form S-3,
Commission File No. 333-40331 and incorporated herein by
reference))
5.1 -- Opinion of Akin, Gump, Strauss, Hauer & Feld, L.L.P.
*12.1 -- Statement re Computation of Ratios (filed as Exhibit 12.1
to Registration Statement on Form S-3, Commission File
No. 333-40331 and incorporated herein by reference)
23.1 -- Consent of Akin, Gump, Strauss, Hauer & Feld, L.L.P.
(included in Exhibit 5.1)
23.2 -- Consent of KPMG Peat Marwick LLP
24.1 -- Power of Attorney (filed as Exhibit 24.1 to Registration
Statement on Form S-3, Commission File No. 333-40331 and
incorporated herein by reference and included in the
signature page of this Amendment No. 1)
*25.1 -- Statement of Eligibility of Trustee on Form T-1 (filed as
Exhibit 25.1 to Registration Statement on Form S-3,
Commission File No. 333-40331 and incorporated herein by
reference)
- ---------------------------
* Previously filed.
** To be filed by amendment.
ITEM 17. UNDERTAKINGS.17 -- UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes as follows:undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statementRegistration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) to reflect in the prospectus any facts or events arising after
the effective date of this 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 this 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
II-3
16
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 this Registration Statement;
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in thethis Registration Statement
or any material change to such information in this Registration
Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) above do not apply
if the information required to be included in a post-effective amendment by
these paragraphs is contained in periodic reports filed with or furnished by the
Registrant pursuant to Section 13 or 15(d) of the Exchange Act that are
incorporated by reference in this Registration Statement.Statement;
(2) That,that, for the purpose of determining any liability under the
Securities Act, each such post- effectivepost-effective amendment shall be deemed to be a
new registration statement relating to the securities offered herein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.thereof; and
(3) Toto 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.Offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to sectionSection 13(a) or sectionSection 15(d) of the
Exchange Act that is incorporated by reference in the registration statementthis Registration Statement
shall be deemed to be a new registration statement relating to the securities
offered therein,herein, 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 Securities 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 II-2
20
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-3II-4
2117
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
StatementAmendment
No. 1 to be signed on its behalf by the undersigned, thereunto duly authorized,
in the cityCity of Cleveland,Valley View, State of Ohio, on May 15,December 5, 1997.
INTERNATIONAL ALLIANCE SERVICES, INC.
(Registrant)
By: /s/ EDWARD F. FEIGHANGREGORY J. SKODA
-------------------------------------
Edward F. Feighan
ChiefGregory J. Skoda
Executive Officer andVice President
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each person whose signature appears
below on this Registration Statement hereby constitutes and appoints Edward F. Feighan,Michael G. DeGroote and Gregory J. Skoda, and Craig L. Stout, and
each of them, with fullthe power to act without the other, his true and lawful
attorney-in-factattorneys-in-fact and agent,agents, with full power of substitution and
resubstitution, for him andin his name, place and stead, in any and all capacities,
(until revoked in writing), to sign on his behalf individually and in each capacity stated below any andor all
amendments or post-effective amendments to this Registration Statement, of International Alliance Services,
Inc. and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission,commission, granting unto each 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
and about the premises, as fully to all intents and purposes as he might or
could do in person, therebyhereby ratifying and confirming all that each of said
attorneys-in-fact and agents, or theireither of them, or histheir 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
StatementAmendment No. 1 has been signed below by the following persons on behalf of the
Company in the capacities
andindicated on the dates indicated.December 5, 1997.
SIGNATURE TITLE
DATE
--------- -----
----
/s/ MICHAEL G. DEGROOTE* President, Chief Executive Officer, Chairman
- ----------------------------------------------------- of the Board and Director May 15, 1997
- ----------------------------------(Principal
Michael G. DeGroote /s/ EDWARD F. FEIGHAN Chief Executive Officer, May 15, 1997
- ---------------------------------- President and Director
Edward F. Feighan (Principal Executive Officer)
/s/ HARVE A. FERRILL Director May 15, 1997
- ----------------------------------
Harve A. Ferrill
/s/ DOUGLAS R. GOWLAND Senior Vice President - Environmental May 15, 1997
- ---------------------------------- Operations and Director
Douglas R. Gowland
/s/ RICHARD C. ROCHON Director May 15, 1997
- ----------------------------------
Richard C. Rochon
/s/ GREGORY J. SKODA Executive Vice President and May 15, 1997Director
- ---------------------------------------------------------------------------------------
Gregory J. Skoda
/s/ CHARLES D. HAMM, JR. Chief Financial Officer and Treasurer
- ----------------------------------------------------- (Principal Accounting and Financial Officer)
Charles D. Hamm, Jr.
/s/ * Director
- -----------------------------------------------------
Rick L. Burdick
/s/ JOSEPH S. DIMARTINO Director
- -----------------------------------------------------
Joseph S. DiMartino
/s/ * Director
- -----------------------------------------------------
Harve A. Ferrill
/s/ * Director
- -----------------------------------------------------
Hugh P. Lowenstein
/s/ * Director
- -----------------------------------------------------
Richard C. Rochon
*By: /s/ GREGORY J. SKODA
------------------------------------------------
Gregory J. Skoda,
Financial and Accounting Officer)
/s/ CRAIG L. STOUT Chief Operating Officer May 15, 1997
- ---------------------------------- and Director
Craig L. Stout
Director May --, 1997
- ----------------------------------
Hugh P. Lowensteinas Attorney-in-fact
II-5
2218
EXHIBIT INDEX TO EXHIBITS
EXHIBIT
NUMBER EXHIBIT DESCRIPTION
- ------ -------------------------- -----------
4.1**4.1 -- Form of StockAmended and Restated Certificate of Common StockIncorporation of the
CompanyRegistrant (filed as Exhibit 4.13.1 to the Company's Registration
Statement on Form 10, file no. 0-25890,Commission File No. 000-25890 and
incorporated herein by reference).
5.1**
*4.2 -- Certificate of Amendment to the Amended and Restated
Certificate of Incorporation of the Registrant (filed as
Exhibit 3.2 to Annual Report on Form 10-K for the fiscal
year ended December 31, 1996, Commission File No.
000-25890 and incorporated herein by reference)
*4.3 -- Amended and Restated Bylaws of the Registrant (filed as
Exhibit 3.2 to Registration Statement on Form 10,
Commission File No. 000-25890 and incorporated herein by
reference)
*4.4 -- Form of Indenture for Debt Securities (filed as Exhibit
4.4 to Registration Statement on Form S-3, Commission
File No. 333-40331 and incorporated herein by reference)
*4.5 -- Form of Debt Security (included in Exhibit 4.4 (filed as
Exhibit 4.4 to Registration Statement on Form S-3,
Commission File No. 333-40331 and incorporated herein by
reference))
5.1 -- Opinion of Akin, Gump, Strauss, Hauer & Feld, L.L.P.
23.1*12.1 -- ConsentStatement re Computation of KPMG Peat Marwick LLP.
23.2**Ratios (filed as Exhibit 12.1
to Registration Statement on Form S-3, Commission File
No. 333-40331 and incorporated herein by reference)
23.1 -- Consent of Akin, Gump, Strauss, Hauer & Feld, L.L.P.
(included in its opinion filedExhibit 5.1)
23.2 -- Consent of KPMG Peat Marwick LLP
24.1 -- Power of Attorney (filed as Exhibit 5.1).
24.1 -- Powers of Attorney (includedto Registration
Statement on Form S-3, Commission File No. 333-40331 and
incorporated herein by reference and included in the
signature pages attached hereto).page of this Amendment No. 1)
*25.1 -- Statement of Eligibility of Trustee on Form T-1 (filed as
Exhibit 25.1 to Registration Statement on Form S-3,
Commission File No. 333-40331 and incorporated herein by
reference)
- ------------------------
* Previously filed.
** To be filed by amendment