SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8 KSB
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
December 1, 1999
(Date of Report)
Cassco Capital Corporation
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
0 41703 51 0356301
(Commission File Number) (IRS Employer Identification Number)
Number 1, Fenton Way Business Park, Fenton Way,
Chatteris, Cambridgeshire PE16 6US
(Address of principal executive offices including zip code)
(44) 01354.694.000
(Registrant's telephone number including area code)
Not Applicable
(Former name or former address, if changed since last report)
Item 1. Change in Control of Registrant.
Acquisition of S&J (Chatteris) Holdings Limited as a Wholly Owned Subsidiary of
Registrant:
On December 1, 1999, Cassco Capital Corporation, a Delaware corporation
(Company), entered into an agreement (Reorganization Agreement) to acquire all
of the outstanding capital stock of S&J (Chatteris) Holdings Limited, a United
Kingdom corporation (S&J Holdings). Pursuant to the Reorganization Agreement,
the Company agreed to acquire all of the outstanding capital stock of S&J in
exchange for 12,000,000 post split shares of its common stock.
Background and Overview of S&J (Chatteris) Holdings, Ltd.:
S&J Holdings was formed as a United Kingdom (UK) corporation in 1998 for the
purpose of establishing its separate strategic divisions into corporate
subsidiaries and acquiring all of the outstanding shares of those businesses
which were not then wholly-owned. The significant UK subsidiaries are (1) S&J
(Chatteris) Cladding Limited - roofing and cladding projects to approximately
$7,500,000; (2) S&J (Chatteris) Steelwork Limited - structural steelwork; (3)
S&J (Chatteris) Construction Limited - project management and general building;
(4) S&J (Chatteris) Special Projects Limited - smaller roofing and cladding
projects to approximately $200,000; (5) Specialist Glazing Systems Limited -
roof and window glazing; and (6) Specialist Finishing Systems Limited -
finishing and refurbishment. These subsidiaries service all of the UK and assist
in the other operations of the group on an as needed basis.
In addition to the UK subsidiaries, there are two subsidiaries which provide
direct oversight to project activity in Ireland and Poland. These are officed in
Belfast, Northern Ireland (S&J (Ireland) Limited), and Wroclaw, Poland (S&J
Polaska sp.zo.o). These subsidiaries were established to capitalize on the
economic development and construction opportunities present in Ireland and
Poland and were built on the previous work undertaken by the S&J Group directly
through its UK subsidiaries in these countries. They provide all of the services
provided in the UK and allow the group to offer hands on service to its foreign
clients. (S&J Holdings and its subsidiaries are collectively referred to as the
S&J Group).
The S&J Group traces its roots back to 1974 when it was a small, specialist,
industrial building company. The business to 1994 had focused on providing
specialty sub-contracting services to industrial building contractors in the UK.
Mr. Mark Langley joined the business in that year and immediately began the
process of changing the primary focus of the business to the direct provision of
a full panoply of building services rather than sub-contracting certain
specialty services. Mr. Langley then expanded the geographical focus of the
business beyond the UK and continued with the implementation of his vision so
that the business now provides complete design, manufacturing and building
services for industrial building projects throughout the UK, Ireland and Poland,
with the added ability to deliver these services throughout Europe and western
Africa. The diversification of operations by Mr. Langley, combined with building
a reputation for high quality performance, has provided the basis for the growth
the business has seen since Mr. Langley's association.
Consistent and steady growth have been the hallmarks of the S&J Group since Mr.
Langley's joining the firm. In 1994, the organization generated gross revenues
of approximately L1 million. By 1996 core business operations generated gross
revenues of in excess of L6 million. During 1997 and 1998, Mr. Langley
consolidated his ownership of the S&J Group and divided the corporate structure
of the group through the establishment of S&J Holdings and the constituent
subsidiaries comprising the S&J Group. The subsidiaries were formed by grouping
together the activities by the specialist area they operated in. Further, in
1998 a steel work fabrication center was established approximately 15 miles from
the head office which enabled the S&J Group to cover many facets of its business
which were previously conducted in disparate locations and the S&J Group
concentrated its operations in a purpose built headquarters at Chatteris. All of
the growth within the group has been internal. There have been no significant
external acquisitions.
These developments significantly disrupted management time and focus on the
day-to-day operations of the S&J Group, which impacted gross and net revenues,
but provided the impetus to move the business forward beyond 1998 to new levels
of activity and development; however, in spite of these disruptions, gross
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revenue rose to approximately L13.7 million in 1997, L17.5 million in 1998 and
is expected to rise to more than L32 million in 1999. This represents an average
annual growth of 65% in gross revenues over the last five years. In 1997 the S&J
Group was placed in 70th position in the London Sunday Times Fast Track 100
Companies, and then moved up to take 22nd place in 1998. Management are informed
that the S&J Group will again be in the listing, a record third straight time,
but have not been informed on their ranking.
Group Revenues:
To provide an indication of the relative scale of each section of the group's
operation, the gross revenues anticipated for 1999 are as follows:
Cladding L14.0 million
Construction L10.0 million
Special projects L3.3 million
Steelwork L2.6 million
Glazing L2.2 million
Cladding:
The roof and wall cladding business has been the main driver in the recent
revenue growth of the group. Operating in conjunction with the steelwork and
glazing subsidiaries, it offer clients a complete frame and external envelope
service. Having all the disciplines "in house" provides a single source
responsibility for integrated design and detailing. Roofing and cladding
contracts range generally from L100,000 to L5 million for national contractors,
project management companies, architects and direct clients.
The group works closely with the manufacturers of most of the leading high
quality roofing and cladding systems and are accredited installers for:
Hoogovens Aluminium Building Systems
Kingspan
Euro-Clad
Coseley Building Products
Ward Brothers
S&J has the latest generation of computerized design, estimating and cost
control systems.
Staffing at the Chatteris head office is as follows:
Commercial/estimators 5
Contract 6
Design 7
Surveyors 5
Purchasers 5
Administration 4
The installation teams are extensively trained through continuing development
programs. The training is both product specific and generic, with particular
attention to health and safety matters. The core teams are directly employed
personnel, augmented by bona fide sub-contractors.
Contracts have been completed in all parts of the United Kingdom. In the latter
part of 1998 an office was established in Sevenoaks, Kent, and now has a full
range of staff encompassing design, estimating, surveying and site supervision.
3
Construction:
This has been the original and core business for twenty five years. With the
growth in demand for "design and build" contracts, it has emerged in recent
years in a key role as principal contractor, locally and nationally, for
projects up to a value of L5 million. It is then able to draw on the specialist
skills of its fellow-subsidiaries.
Great emphasis is placed on developing strong bonds with both clients and their
advisers to ensure that objectives are met. The head office team includes four
experienced project managers, as well as designers, buyers and surveyors. There
are five site managers and core teams of directly employed personnel. Recent
contracts include the design and build of a 90,000 sq. ft cold storage facility
in East Anglia for L3.6 million and a new stand at Worcester rugby club.
Special Projects:
Special projects was formed to deal specifically with industrial and commercial
roofing, cladding and refurbishment projects. Job values range from a few
thousand pounds to about L150,000. The clients are widespread, including local
authorities, building owners, main contractors, project managers and architects.
A free detailed survey and estimating service is offered to clients as the
company is able to provide impartial advice on material specifications. Quality
is the crucial feature, and the workforce is all directly employed. The
accreditation from high quality product suppliers is shared with the cladding
subsidiary.
The lower value jobs and the close relationships developed with clients over the
years have resulted in considerably higher margins than those obtainable on
larger cladding jobs. Revenue growth in the last year has been rising from about
L1 million in 1998 to almost L3 million in 1999. The company has a recently
formed subsidiary in Wickford, Essex, which is generating revenues in the South
East, based on the same range of services.
Steelwork:
Currently based at St Ives, Cambridgeshire, S&J (Chatteris) Steelwork Limited
specializes in the design, fabrication and installation of structural steelwork
and architectural metal works. As with the other subsidiaries in the group,
steelwork forms an integral part of the services mix that the group offers to
the building industry. It not only provides the cladding and roofing services
with marked competitive advantage, as it provides a true design and build
service to the client, but also forms a separate and valuable contribution to
the profitability of the group.
The present location, with a production facility of 15,000 sq. ft., is proving
too small for the potential of the business, and it is planned that it will be
re-located to a new, purpose built facility on land owned by the group on the
head office site by mid 2000.
Recent substantial investment has been made in state of the art CNC,
close-coupled sawing and drilling line, which links to a specialist CAD package
and allows accurate and efficient fabrication of all structural members. The
system marks all components with markings to enable quick and accurate erection.
This generates substantial labor cost savings and quality improvements on site.
Typical recent projects are:
The construction of eight steel frame buildings for the Ministry of
Agriculture and Foods at Addlestone, complete with overhead walkways,
balustrades and staircases, for a project value of L600,000.
Intricate structural steel framing for apartments and balconies to
nine-story luxury block in Docklands - project value L185,000.
Three office and industrial buildings in Byfleet, Surrey - project value
L220,000.
Internal steel structures and roof top conservatories at the new Harrods
Village development in Barnes, London - project value L700,000..
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Glazing:
Specialist Glazing Systems Limited, based at the head office at Chatteris, is
similar to the steelwork subsidiary in forming another key component of the
one-stop shop. The market for the company's products has three segments:
Industrial building applications linked to general cladding work
Business park developments, which have a very high glas content
Curtain wall systems which are almost entirely glazing.
A recent, major contract was the refurbishment of London's Charing Cross railway
station. The company is strengthened by approved dealerships for Vitral, Velfac,
Shucco, Technal and Senior Aluminium window, curtain wall and roof glazing
systems.
Ireland:
In recent years the group has completed several cladding contracts in Northern
Ireland. The economic environment in Eire has been buoyant for some time and the
peace process is likely to generate a significant influx of investment and
infrastructure funding - some of which is already underway. In order to be in
the best position to capture the potential it is necessary to have a local
office under the direction of an Irish manager. Earlier this year Mr. Victor
Elliott, who had been Hoogovens' representative in Northern Ireland agreed to
lead the establishment of S&J in Ireland. Offices just outside Belfast have been
leased and equipped, and operations are begun.
Poland:
S&J Polska Sp.zo.o. was incorporated in March, 1999, after research into the
Polish and central European market for cladding and roofing. The S&J Group
already had experience operating in Poland, having built a new Cadbury's factory
in Wroclaw. A pilot office has been set up in the city of Kalisw, which is
located between the major cities of Wroclaw, Poznan and Warsaw - ideally placed
to service the booming construction industry and to establish in central Europe.
Poland is experiencing unprecedented economic growth, and is likely to be the
next candidate for entry to the EU in 2004. It is also an excellent base for
activity in the Czech and Slovakian Republics and in Hungary, which are
experiencing similar growth.
Initially, S&J Polska is drawing on the technical services of the S&J head
office in order to service inquiries; however, it is setting up its own
estimating and design office. Staff have visited Chatteris for training and
there is a real expectation that the Polish office could soon support the
drawing and design function in the UK, where expansion is restricted by UK wide
skills shortages, at a fraction of the UK cost.
Negotiations are underway for the construction of a hypermarket for Tesco in
South East Poland, in co-operation with the subsidiary of a large UK contractor.
A very considerable area of growth for the company in Central Europe is not only
the construction of industrial and distribution centers, but also a need for
extensive refurbishment of existing buildings. These activities draw on all
aspects of S&J's expertise and exploit its competitive advantage to the full.
Other Projects:
S&J are currently in negotiations with a number of international contacts, which
are expected to result in a substantial international division being formed next
year. The concept of an international project management team is taking shape to
take advantage of the group's unique single source supply potential. Projects
receiving attention include the construction of a prestigious headquarters
building for a bank in Nigeria, and the refurbishment of an industrial "brorn
fields" site in central Europe, linked to EU funding.
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New Management:
The Board of Directors, as a result of the S&J acquisition, now consists of one
member, Mr. Mark Langley, who, it is anticipated, will appoint additional
directors in the near future. Mr. Langley is also presently the sole executive
officer of the Company. The following table sets forth all those persons who are
now executive officers of the Company and S&J.
Name Position with Company and the S&J Group
---- ---------------------------------------
Mark Langley Chairman and Chief Executive Officer
David Rogers Director of S&J Holdings - Corporate Finance and Acquisitions
David Rowe Managing Director - Contracting
Steve Cutts Controller
Jamie McGinty Managing Director - Cladding
Harry Rose Managing Director - Construction
Robin Harris Managing Director - Special Projects
Tom Bently Managing Director - Steel
Neil Tolley Managing Director - Glazing
Victor Elliott Managing Director - Ireland
George Fokias Managing Director - Poland
(1) None of the above individuals has any arrangement or understanding whereby
they are or will be selected as a director or nominee of the Company or of S&J.
All directors and executive officers will hold office until the next annual
meeting of shareholders and until their successors have been elected and
qualified. All officers are elected by the Board of Directors at its annual
meeting immediately following the shareholders' annual meeting and hold office
until their death or until they earlier resign or are removed from office. There
are no written or other contracts providing for the election of directors or
term of employment of executive officers, all of whom serve on an at will basis.
Profiles of Directors and Executive Officers of the Company and S&J:
S&J Holdings:
Mark Langley, age 38, has been the President, Chief Executive Officer and
Chairman of the Board of Directors of the Company since December 1, 1999. He
holds similar positions with S&J Holdings and directs the operations of the S&J
Group, having held those positions since 1994. Mr. Langley began his technical
education more than 20 years ago as a laborer and has succeeded to management
through job promotions within the industry and lateral hires. He has built up a
broad range of experience including project management and contracting skills.
David Rogers, aged 53, has been with the group for approximately two years. He
is a chartered accountant with 18 years experience at Price Waterhouse. Mr.
Rogers has served and continues to serve as chairman and a director to several
manufacturing companies. He received a degree in Engineering Science from Exeter
University.
David Rowe, aged 48, has been with S&J Holdings since 1998 and oversees the
structuring and implementation of the financial operations of the various
subsidiaries of the S&J Group. He was previously a director of surveying at
another construction company. Mr. Rowe leads a team which has principally
established tight controls over contracts and cash collections while supervising
the implementation of formalized disciplines over all aspects of construction
contract work.
Steve Cutts, aged 40, has over 20 years experience as a financial controller and
cost accountant, ten of which have been in the construction industry. He is
responsible for the day-to-day oversight of the finance and accounting
departments of the S&J Group.
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Subsidiary Companies
Cladding: Jamie McGinty, aged 32, and has spent all his working life in the
roofing and cladding industry. After 11 years as a site worker, he joined the
S&J Group five years ago as site manager. Under the direction of Mr. Langley he
has made strong progress and is now responsible for all roofing and cladding
activity.
Construction: Harry Rose, aged 50, joined the S&J Group earlier this year and
brings extensive experience in the construction industry.
Special Projects: Robin Harris, aged 41,has led the development of this
operation. He spent thirteen years running the estimating and design offices of
roofing and cladding companies before joining Mr. Langley with the S&J Group.
Steelwork: Tom Bentley, aged 39, has developed the steelwork specialism over the
last three years with the S&J Group. Previously, he worked for one of the UK's
largest steelwork fabrication companies. He has an in-depth knowledge of
automated production. Mr. Bentley started out as a welder fabricator, progressed
rapidly to site erection of steel framed buildings and on to senior management.
Glazing: Neil Tolley, aged 35, has recently taken over the directorship of this
subsidiary. He started in the industry as an apprentice draughtsman, moved on to
being a design estimator and later a project manager.
Ireland: Victor Elliot leads development across Ireland. He has many years
experience in contracting work in Ireland. He was previously with Hoogoven's
Aluminum Building Systems in Ireland.
Poland: George Fokias is a British national and managing director of the Polish
subsidiary, S&J Polska Sp.zo.o. He has worked in Poland for three years.
Previously, he spent 18 years in mainland Europe, North Africa and the Middle
East in senior management positions with construction equipment marketing
companies. He is a member of the Institute of Chartered Accountants and also
holds a postgraduate diploma in industrial administration. He has gained a
wealth of experience in establishing industrial and construction subsidiary
companies for UK parent companies in places such as Saudi Arabia, The United
Arab Emirates, The Bahamas, Spain, Morocco and Poland.
Current Market for The S&J Group:
The UK and Europe remain the S&J Group's main focus for commercial activity. The
S&J Group enjoys Europe-wide project activity, and with the specialist focus of
each business within the group, management believes that clients are finding
more and more reason and opportunity to buy a complete construction package from
one source.
Management feels that the present is an ideal time in Europe for construction
companies to investigate other, more rapidly growing, markets. In response,
operations were recently expanded into Poland and Ireland where the group will
pursue the opportunities provided by these markets. As overseas activity
expands, management anticipates forming a specialist world-wide project team to
manage contracts and construction activity on a global basis. These projects
will see a number of different companies within the S&J Group working together
to provide the client with project management, design and build services.
The unique aspect which sets the S&J Group apart from its competitors is the
group's diversity of skills and its ability to provide a single source supply
point. Strategies for the future development of the group must be set against
market conditions prevalent in the UK, which constitutes our main market. Market
conditions embrace not only trends of building spend on the range of materials
or over the variety of buildings, but also the structural changes in the market.
Structural changes:
In 1998 the government set up a task force under the chairmanship of Sir John
Egan to review the way construction was undertaken in the UK and to suggest
improvements. The Egan Report identified five key drivers of change:
Committed leadership
A focus on the customer
Integrated processes and teams
A quality driven agenda
Commitment to people
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These changes will, and have already begun to, affect the S&J Group in the
following ways:
Less reliance on tendering and contracts
More effort required to develop and maintain relationships with customers
Integration of the design and construction processes
Greater involvement in the design and project management
Developing construction performance indicators to measure progress (bench
marking)
Elimination of waste
Better conditions for those who work in the industry
S&J is well placed to take advantage of these trends; particularly in the
integration of design and construction. S&J is further developing the skills and
techniques involved in gaining and maintaining relationships with key clients,
primarily through partnering arrangements. The objectives of partnering are:
To complete works for the client within budget, on time and to the quality
standards, with zero defects being the eventual objective
Safety - to ensure works are designed and carried out in a safe and
workmanlike manner without any Health and Safety concerns, no accidents or
injuries and aim for zero incidents
Build and maintain good working relationships based on trust, fairness,
honesty and open communication
Promote innovation, imagination and efficiency
Permit a positive cash flow, reasonable profitability and a willingness to
share savings arising from the above
When problems do occur, deal with them in a positive, proactive manner and
avoid traditional dispute procedures
Market Trends:
S&J has two sources of relevant market data: (1) MSI produces a survey of annual
trends in the roofing market each December; and (2) Construction Markets
produces a commissioned report for Hoogovens each quarter
The MSI figures show that the roofing market peaked in 1994 and declined by
about 3% in the following two years before recovering again in 1997 and 1998
back to 1994 levels, representing a total market of some L930 million - but this
is roofing alone and does not include cladding, nor the other S&J activities.
Factors driving the recovery are the relatively stable UK economy, the release
of government monies for public sector housing, the funding available from
lottery grants, private finance initiative schemes and the substantial
investment plans to renovate and refurbish stations. MSI forecast further growth
in 1999 and 2000 amounting to a further 4% before a flattening off. They warn
that new construction in the commercial and public non-housing sectors may
decline. Half the market is new work and the remainder repairs and maintenance.
S&J's specialty is high quality aluminum roofing and cladding. Metal roofing
currently represents about 30% of all roofing materials, but metal has grown by
6.5% over the last five years, whereas the market has been static for more
traditional materials. Within the metal roofing sector, aluminum usage has grown
by over 50% in the same period. Manufacturers of aluminum roofing, such as
Hoogovens, have actively marketed its environmental properties, especially its
ability to be recycled. MSI conclude that aluminum will continue to gain market
share as manufacturers heighten awareness of the material amongst specifiers.
8
The Hoogovens statistics are more relevant to S&J because they include not only
roofing but also wall cladding. They are also more up to date. The wall cladding
market currently is about half the size of the roofing market, but is growing
more rapidly (by 7.3% in 1998 compared with the 2.6% for roofing).
Hoogovens' figures show the profiled metal and standing seam roofing to have
grown by 26% over the last five years, compared with 11% for traditional
materials. The market for walling has grown more quickly than that for roofing
because of the increasing use of high rise prestigious building as the UK
recession ended.
Hoogovens provides a very useful forecast of floor area for new build across the
various sectors. This shows a 6.6% rise in total for 1999 over 1998, which
itself represented a growth of 6.2% over the previous period. For 2000 the
overall figure is set to fall by 6.5%, but there is significant variation over
the sectors. Office building will continue to rise, by 7.5%, and public sector
building will also advance, but retail will decline by 15%, leisure by 12% and
industrial by 10%.
While S&J has benefited from being in the forefront of an increasing use of
aluminum in a reasonably buoyant market, its growth has comfortably exceeded
that of the market sector. The statistics suggest that an emphasis on office
buildings and other public sector developments holds the best prospect of
maintaining that growth.
The other message from the statistics is that now is an ideal time to seek out
other, more rapidly growing markets, and the developments in Poland and Ireland
appear timely.
Future Markets and Vision for the S&J Group:
Negotiations are underway with a number of international contacts which the S&J
Group anticipates will provide a substantial division being formed in the next
12 months. There can, however, be no assurance of this. One example has been a
request to provide proposals for the design and supply of the steel frame,
curtain wall and roof of a prestigious headquarters for a bank and housing
construction group in Nigeria, where the S&J Group has worked previously. This
project would see a number of different companies within the S&J Group working
together to provide the client with a project management, design and build
service.
S&J Group provides a diversity of skills under one roof, a significant
differentiation from its competitors. Also, the group has the ability to provide
a single source supply point which results in considerable savings in cost and
time and allows greater project control. This, management believes, will allow
the group to be competitive in these markets.
The vision for the S&J Group is to be the UK's leading provider of building
frames and external envelopes, driven by a clear understanding of its partners'
needs. Already, its ability to provide a one-stop provision singles it out and
enables its clients to eliminate the traditional interface problems between
specialist subcontractors.
Much of the revenue growth will result from the balancing-up effect of being
responsible for the whole building frame and envelope. This will provide
significant growth opportunities for steelwork and window fabrication, but will
require enhanced manufacturing facilities in new buildings on the head office
site during the next year or two. Planning for the new facilities is well
advanced and the total cost is likely to be about L1.5 million.
Elsewhere, revenues are expected to rise more rapidly in strongly growing
economic environments, such as Poland and Ireland. Other overseas opportunities
are being researched and the concept of a worldwide project management team
developed.
Corporate Culture and Vision:
The business strives to provide a culture which positively fosters ambition
among the workforce. Mr. Langley leads by example with enthusiasm, flexibility
and a strong feeling for client feedback. Products have been created to meet
market demand, and a complete commitment to quality has earned the S&J Group a
good reputation and outstanding levels of customer retention. Mr. Langley and
his team recognize the need to examine what is required to keep pace in the
market and to forge ahead.
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The vision now is for the S&J Group to become the UK's leading provider of
building frames and external envelopes, driven by a comprehension of its
business partners' needs. The S&J Group is well placed and has provision to
expand significantly during the next five years.
The culture of the organization, epitomized by Mark Langley, is one of
enthusiasm and flexibility, of sensitivity to clients' reactions and of pride in
a job done well and on time. There is a strong work ethic and an environment in
which ambition is allowed to flourish. This culture has enabled the group to
grow, outstripping the growth in the underlying market, which itself has been
healthy.
The UK market is changing, driven by the Egan report, but with greater degree of
variability of growth rates for future building. Trends derived from the Egan
report favor companies who offer a high level of customer awareness and a
willingness to contribute project management skills, and a wide range of
building components. Commercial office building and publicly financed projects
offer the best prospects for future volumes.
The market is likely to be less strong in the next few years and the group will
only be able to grow at these rates and hold or increase margin if it commits
itself to clear strategies. Those strategies are in part general, affecting the
whole group, and in part specific, affecting one or more parts in particular.
Financial Control and Risk Management:
A comprehensive, integrated suite of computer programs which are specifically
designed for businesses operating in the construction industry are used for
financial planning and accounting. The programs also provide modern, in-depth
cost accounting abilities to the organization on a project-by-project basis so
as to allow day-to-day oversight of the construction process. Surveyors or
project managers and executive staff review the reports periodically so that any
deviation from the plan can be identified immediately. This is a valuable
management tool which allows for immediate assessment of the cost and margins
being generated by each job on a periodic basis.
Site management is an important aspect in the Group and is the direct
responsibility of site supervisors. Daily visits are made to smaller projects;
whereas larger projects have a member of staff on site full time. Time on site
is being measured as part of a focus on performance and a dedicated debriefing
takes place with each client at the completion of a project. Maintaining first
class client relationships is seen as a major part of the business and client
perception surveys are being introduced as a routine operation.
The S&J Group has not experienced customer bad debts, but considerable
investment has been made in insuring against aggregate bad debt in excess of
L100,000 annually.
Facilities:
The head office of the UK operations is Number One, Fenton Way Business Park,
Fenton Way, Chatteris, Cambridgeshire, U. K. The telephone number at this
address is 01354.694.000. The group also maintains leased operations in
Sevenoaks, Kent, Wickford, and Essex. The office in Ireland is located in
Belfast at 20 Comber Road, Newtownards, County Down BT23 4RX. The office in
Poland is in Kalisz at Ul Czestochowska 25, 62-800. The web site address for the
S&J Group is www.sjgroup.co.uk.
The Company, as of the date of this report, owned no real or personal property,
tangible or intangible, other than its ownership of all of the issued and
outstanding common shares of S&J. Conversely, the Company had no liabilities
which had not either been paid in their entirety or fully provided for.
The head office and base for most of the S&J Group's activities is a freehold
building in Chatteris constructed by the group in 1998 for about L700,000 and
occupied from September 1998. The building is an open floor plan comprising
approximately 12,000 sq. ft. of office space, comfortably accommodating the head
office team of about 70, together with 6,000 sq. ft of light industrial space
which houses the window manufacturing facility.
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Fifteen miles away, in St. Ives, are two adjacent industrial units amounting to
approximately 15,000 sq. ft which house the steelwork fabrication business. The
steelwork business is growing quickly, mainly as a result of new business linked
to cladding contracts, and needs additional space. The premises in St. Ives are
held on short leases and there is the opportunity to vacate them during 2000.
Plans are well advanced to build a specially designed facility for steelwork
with a floor area of 30,000 sq. ft on freehold land immediately next to the head
office building. It is anticipated that the shell of this building will be
completed towards the end of this year and ready for occupation by June of next
year.
In addition the Cladding subsidiary has an office in Kent and Special Projects
has an office in Essex.
The facility for producing glazing units in house was set up in 1998 and
includes a variety of state of the art saws, jigs and materials handling
equipment, sufficient to deal with more than double the present output.
Present Capital Structure:
The Company's equity capitalization presently consists of two classes of stock,
common and preferred. There are 100,000,000 shares of Common Stock, par value
$.001 per share, and 10,000,000 shares of Preferred Stock, par value $.01 per
share, which are authorized to be issued. All outstanding shares of Common Stock
are fully paid for and nonassessable. A holder of Common Stock is entitled to
one vote per share on all matters submitted for action by the stockholders. A
quorum for the transaction of business at any meeting of the holders of Common
Stock is one third of the shares outstanding. All shares of Common Stock are
equal to each other with respect to the election of directors; therefore, the
holders of more than 50% of the outstanding Common Stock present at a meeting at
which a quorum is present and at which directors are being elected can, if they
choose to do so, elect all of the directors. Thus, the holders of as little as
16.51% of the outstanding Common Stock could elect directors. The terms of the
directors are not staggered. Directors are elected annually to serve until the
next annual meeting of stockholders and until their successor is elected and
qualified. There are no preemptive rights to purchase any additional shares of
Common Stock or other securities of the Company, nor is cumulative voting
applicable to the election of the Board of Directors. The shares of Common Stock
have those dividend rights prescribed by the laws of the State of Delaware, are
not convertible into any other security, do not have sinking fund provisions
applicable to them and are not subject to redemption or to any restrictions on
transfer.
As of December 3, 1999, the transfer ledgers maintained by the Company's stock
transfer agent, including individual participants in security position listings,
indicated that there were approximately 15,000,000 shares of Common Stock issued
and outstanding.
The Articles of Incorporation vest the Board of Directors with the authority to
divide the Preferred Stock into series and to fix and determine the relative
rights and preferences of the shares of any preferred series established to the
full extent permitted by the laws of the State of Delaware and the Articles of
Incorporation with respect to, among other things, (a) the number of shares to
constitute a series and the distinctive designation thereof, (b) the rate and
preference of dividends, if any, the time of payment of dividends, whether
dividends are cumulative and the date from which any dividends begin accruing,
(c) whether shares may be redeemed and, if so, the redemption price and the
terms and conditions of redemption, (d) the liquidation preferences payable in
the event of involuntary or voluntary liquidation, (e) sinking fund or other
provisions, if any, for the redemption or purchase of shares, (f) the terms and
conditions upon which shares may be converted, if convertible, and (g) voting
rights, if any. The Company, as of December 1, 1999, had no Preferred Stock
outstanding.
Signature Stock Transfer, 14675 Midway Rd., Ste. 221, Dallas, Texas 75224 has
been engaged by the Company to serve as the transfer agent for the Common Stock.
No dividends have been declared on the Common Stock by the Company since
inception, and no dividends are planned in the foreseeable future; however,
there are no restrictions at present on the declaration or payment of dividends.
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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains certain forward-looking statements, as defined in the
Private Securities Litigation Reform Act of 1995, and information relating to us
that are based on the beliefs of our management, as well as assumptions made by
and information currently available to our management. When used in this
prospectus, the words estimate, project, believe, anticipate, intend, expect and
similar expressions are intended to identify forward-looking statements. These
forward-looking statements reflect our current views with respect to future
events and are subject to risks and uncertainties that could cause actual
results to differ materially from those contemplated in these forward-looking
statements, including those risks discussed under Risk Factors. You are
cautioned not to place undue reliance on these forward-looking statements, which
speak only as of the date on this prospectus. We have no obligation to publicly
release any revisions to these forward-looking statements to reflect events or
circumstances after the date of this prospectus or to reflect the occurrence of
unanticipated events.
Item 2. Acquisition or Disposition of Assets: See Item 1, above.
Item 3. Bankruptcy or Receivership: Not Applicable.
Item 4. Changes in Registrant's Certifying Accountant: Not Applicable.
Item 5. Other Events. Not Applicable.
Item 6. Resignation of Registrant's Directors: Not Applicable.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits:
Pursuant to the terms and conditions of the Reorganization Agreement, the
financial statements required will be filed within the time limitations set
forth in applicable regulations.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CASSCO CAPITAL CORPORATION
(Registrant)
By: /s/ Mark Langley
- --------------------
Mark Langley, Chief Executive Officer
Date: December 3, 1999
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