As filed with the Securities and Exchange Commission on August 28, 2003
Registration No. 333-104228
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Amendment No. 2 to
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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STONEPATH GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware 4731 65-0867684
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(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
1600 Market Street, Suite 1515
Philadelphia, Pennsylvania 19103
(215) 979-8370
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
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Stephen M. Cohen, Esquire
Senior Vice President and General Counsel
Stonepath Group, Inc.
1600 Market Street, Suite 1515
Philadelphia, Pennsylvania 19103
(215) 979-8370
Fax (215) 979-8399
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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Please Address a Copy of All Communications to:
Brian S. North, Esquire
Buchanan Ingersoll Professional Corporation
11 Penn Center, 14th Floor
1835 Market Street
Philadelphia, Pennsylvania 19103
(215) 665-8700
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Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this form are being offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [_]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the preliminary prospectus is expected to be made pursuant
to Rule 434, please check the following box. [_]
CALCULATION OF REGISTRATION FEE
==============================================================================================================================
Proposed Proposed
Amount maximum maximum Amount
Title of each class of to be offering price aggregate of
Securities to be registered registered (1) per share (2) offering price (2) registration fee
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Common Stock, $.001 par value per share 4,992,000 $1.77 $8,835,840 $715.00
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(1) Represents shares of common stock which may be sold by certain selling
security holders.
(2) Estimated solely for the purpose of determining the registration fee in
accordance with Rule 457(c) under the Securities Act of 1933, as amended.
The price per share information is based upon the average of the high and
low sale prices of Stonepath Group, Inc. common stock, $.001 par value per
share, as reported on the American Stock Exchange on March 28, 2003.
Pursuant to Rule 416 of the Securities Act of 1933, as amended, this
registration statement also includes additional shares of common stock issuable
upon stock splits, stock dividends or similar transactions.
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
The information in this prospectus is not complete and may be changed. The
selling shareholders may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and it is not soliciting an
offer to buy these securities in any state where the offer or sale is not
permitted.
Subject to Completion August 28, 2003
Prospectus
STONEPATH GROUP, INC.
4,992,000 shares of common stock
The selling shareholders identified in this prospectus may offer and
sell up to 4,992,000 shares of our common stock. 4,470,000 of these shares were
issued by us on or before March 6, 2003 in a private placement transaction. The
remainder of the shares are issuable upon the exercise of common stock purchase
warrants, 447,000 of which were issued to affiliates of the placement agent in
conjunction with the private placement transaction. The selling shareholders may
sell all or a portion of their shares through public or private transactions at
prevailing market prices or at privately negotiated prices.
We will not receive any part of the proceeds from sales of these shares
by the selling shareholders, although we may receive the exercise price of the
warrants.
Our common stock is listed on the American Stock Exchange under the
symbol "STG." On August 26, 2003, the last sale price of our common stock
reported on the American Stock Exchange was $2.12.
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INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. SEE "RISK
FACTORS" BEGINNING ON PAGE 3 OF THIS PROSPECTUS.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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The date of this prospectus is , 2003.
TABLE OF CONTENTS
ABOUT THIS PROSPECTUS..........................................................................................................1
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STONEPATH GROUP, INC...........................................................................................................1
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RISK FACTORS...................................................................................................................3
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FORWARD-LOOKING STATEMENTS....................................................................................................10
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USE OF PROCEEDS...............................................................................................................10
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THE OFFERING..................................................................................................................10
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SELLING SHAREHOLDERS..........................................................................................................11
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PLAN OF DISTRIBUTION..........................................................................................................14
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WHERE YOU CAN FIND MORE INFORMATION...........................................................................................16
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LEGAL MATTERS.................................................................................................................18
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EXPERTS.......................................................................................................................18
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ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement we filed with the
Securities and Exchange Commission. You should rely only on the information
provided in this prospectus or incorporated by reference into this prospectus.
We have not authorized anyone to provide you with information different from
that contained or incorporated by reference into this prospectus. The selling
shareholders are offering to sell, and seeking offers to buy, shares of common
stock only in jurisdictions where offers and sales are permitted. The
information in this prospectus is accurate only as of the date of this
prospectus, regardless of the time of delivery of this prospectus or of any sale
of common stock. The rules of the Securities and Exchange Commission may require
us to update this prospectus in the future.
STONEPATH GROUP, INC.
We are a non-asset based third-party logistics services company
providing supply chain solutions on a global basis. We offer a full range of
time-definite transportation and distribution solutions through our Domestic
Services platform where we manage and arrange the movement of raw materials,
supplies, components and finished goods for our customers. These services are
offered through our domestic air and ground freight forwarding business. We
offer a full range of international logistics services, including international
air and ocean transportation, as well as customs house brokerage services,
through our International Services platform. In addition to these core service
offerings, we also provide a broad range of value added supply chain management
services, including warehousing, order fulfillment and inventory management. We
service a customer base of manufacturers, distributors and national retail
chains through a network of offices in 18 major metropolitan areas in North
America, plus two international locations, and an extensive network of over 200
independent carriers and over 150 service partners strategically located around
the world.
Our strategic objective is to build a leading global logistics services
organization that integrates established logistics companies with innovative
technologies. To that end, we are extending our network through a combination of
synergistic acquisitions and the organic expansion of our existing base of
logistics operations.
Our acquisition strategy focuses on acquiring and integrating logistics
businesses that will enhance our position in current markets as well as extend
our network to targeted locations in Asia, South America and Europe. We select
acquisition targets based upon their ability to demonstrate: (1) historic levels
of profitability; (2) a proven record of delivering superior time-definite
distribution and other value added services; (3) an established customer base of
large and mid-sized companies; and (4) opportunities for significant growth
within strategic segments of our business.
As we integrate these companies, we intend to create additional
shareholder value by: (1) improving productivity through adoption of
technologies and business processes; (2) improving transportation margins by
leveraging our growing purchasing power; and (3) enhancing the opportunity for
organic growth through cross-selling and offering expanded services.
1
Our strategy is designed to take advantage of shifting market dynamics.
The third-party logistics industry continues to grow as an increasing number of
businesses outsource their logistics functions to more cost effectively manage
and extract value from their supply chains. Also, we believe that the industry
is positioned for further consolidation since it remains highly fragmented, and
since customers are demanding the types of sophisticated and broad reaching
service offerings that can more effectively be handled by larger and more
diverse organizations.
There are a variety of risks associated with our ability to achieve our
strategic objectives, including our ability to acquire and profitably manage
additional businesses, our current reliance on a small number of key customers,
the risks inherent in international operations, and the intense competition in
our industry for customers and for the acquisition of additional businesses. For
a more detailed discussion of these risks and the risks associated with an
investment in our securities, see the discussion under the "Risk Factors"
section of this Prospectus beginning on page 3.
Our executive offices are located at 1600 Market Street, Suite 1515,
Philadelphia, Pennsylvania 19103 and our telephone number is (215) 979-8370. Our
Internet address is www.stonepath.com. Information contained on our website
should not be considered part of this prospectus.
2
RISK FACTORS
AN INVESTMENT IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK,
INCLUDING THE RISKS DESCRIBED BELOW. YOU SHOULD CAREFULLY CONSIDER THESE RISK
FACTORS AND THE OTHER INFORMATION IN THIS PROSPECTUS BEFORE MAKING AN INVESTMENT
DECISION. THE RISKS DESCRIBED BELOW ARE THE MATERIAL RISKS WE BELIEVE ARE
ASSOCIATED WITH AN INVESTMENT IN OUR COMMON STOCK. IF ANY OF THE FOLLOWING
EVENTS DO OCCUR, OUR BUSINESS, OPERATING RESULTS AND FINANCIAL CONDITION COULD
BE ADVERSELY AFFECTED. THIS PROSPECTUS ALSO CONTAINS FORWARD-LOOKING STATEMENTS
THAT INVOLVE RISKS AND UNCERTAINTIES. OUR ACTUAL RESULTS COULD DIFFER MATERIALLY
FROM THOSE ANTICIPATED IN THESE FORWARD-LOOKING STATEMENTS AS A RESULT OF A
NUMBER OF FACTORS, INCLUDING THE RISKS DESCRIBED BELOW AND ELSEWHERE IN THIS
PROSPECTUS. YOU SHOULD READ THE SECTION ENTITLED "FORWARD-LOOKING STATEMENTS"
FOR A FURTHER DISCUSSION OF THESE FACTORS.
If we are unable to profitably manage and integrate the companies we
acquire or are unable to acquire additional companies, we will not achieve our
growth and profit objectives.
Our goal is to build a global logistics services organization.
Realizing this goal will require the acquisition of a number of diverse
companies in the logistics industry covering a variety of geographic regions and
specialized service offerings. There can be no assurance that we will be able to
identify, acquire or profitably manage additional businesses or successfully
integrate any acquired businesses without substantial costs, delays or other
operational or financial problems. Further, acquisitions involve a number of
risks, including possible adverse effects on our operating results, diversion of
management resources, failure to retain key personnel, and risks associated with
unanticipated liabilities, some or all of which could have a material adverse
effect on our business, financial condition and results of operations.
Additional financing will be required to implement our business
strategy.
We believe that our current working capital and anticipated cash flow
from operations are adequate to fund existing operations. In view of the
outstanding balance under our credit facility, our ability to finance further
acquisitions is limited until we raise additional capital. We may finance
acquisitions, however, using our common stock as all or some portion of the
consideration. In the event that our common stock does not attain or maintain a
sufficient market value or potential acquisition candidates are otherwise
unwilling to accept our securities as part of the purchase price for the sale of
their businesses, we may be required to utilize more of our cash resources, if
available, in order to continue our acquisition program. If we do not have
sufficient cash resources through either operations or from debt facilities, our
growth could be limited unless we are able to obtain such additional capital.
Earn-out payments due in connection with our acquisitions could require
us to incur additional indebtedness or issue additional equity securities.
We are required to make significant cash payments in the future when
the earn-out installments for our acquisitions become due. While we believe that
a material portion of the required cash will be generated by each of the
acquired subsidiaries, we most likely will have to secure additional sources of
capital to fund some portion of the earn-out payments as they become due. This
3
may require us to incur additional indebtedness or issue additional equity
securities. We cannot be certain that we will be able to borrow any funds for
this purpose on terms acceptable to us, if at all, or that once we incur such
indebtedness, that we will be able to operate profitably. Additional
indebtedness could negatively impact our cash flow and ability to make further
acquisitions. Issuing additional shares of common stock or common stock
equivalents to generate the required financing would increase the number of
shares outstanding and further dilute the interests of our existing
shareholders.
This offering will increase the number of shares of our common stock
that may be sold into the market. This could have a downward pressure on the
trading price of our common stock.
Sales of substantial amounts of common stock in the public market
resulting from this offering could reduce the market price of our common stock
and make it more difficult for us to sell equity securities in the future. After
this offering, the 4,992,000 shares covered by this prospectus may be resold
into the public market immediately. These shares represent approximately 16.9%
of our outstanding shares of common stock as of August 22, 2003. Sales of these
shares in the public market, or the perception that future sales of these shares
could occur, could have the effect of lowering the market price of our common
stock below current levels.
Our credit facility has limited availability and places limitations on
the type and number of acquisitions we may make.
We have obtained a $15 million credit facility from LaSalle Business
Credit, Inc. to provide additional funding for acquisitions and for our on-going
working capital requirements. As of August 14, 2003, advances under the facility
were approximately $11.3 million. Thus, we have limited availability under the
facility until we are able to reduce the level of our outstanding advances.
Furthermore, under the terms of the credit facility, we are permitted to make
additional acquisitions without the lender's consent only if certain conditions
are satisfied. The conditions imposed by the credit facility include the
following: (1) the absence of an event of default under the credit facility, (2)
the company to be acquired must be in the transportation and logistics industry,
(3) the purchase price to be paid must be consistent with our historical
business and acquisition model, (4) the undrawn availability under the credit
facility must average $5 million for the 60 days preceding the acquisition and
must be at least $5 million after giving effect for the acquisition, (5) the
lender must be reasonably satisfied with projected financial statements we
provide covering a 12 month period following the acquisition, (6) the
acquisition documents must be provided to the lender and must be consistent with
the description of the transaction provided to the lender, (7) the aggregate
cash consideration paid at the closing for foreign acquisitions must not exceed
$5 million, and (8) the number of such permitted acquisitions is limited to four
per year (excluding any acquisitions for which the purchase price is payable
solely in stock). In the event that we were not able to satisfy the conditions
of the credit facility in connection with a proposed acquisition, we would have
to forego the acquisition unless we either obtained the lender's consent or
retired the credit facility. This may limit or slow our ability to achieve the
critical mass we may need to achieve our strategic objectives.
Since we are not obligated to follow any particular criteria or
standards for acquisition candidates, shareholders must rely solely on our
ability to identify, evaluate and complete acquisitions.
Even though we have developed general acquisition guidelines, we are
not obligated to follow any particular operating, financial, geographic or other
criteria in evaluating candidates for potential acquisitions or business
4
combinations. We target companies which we believe will provide the best
potential long-term financial return for our shareholders and we determine the
purchase price and other terms and conditions of acquisitions. Our shareholders
will not have the opportunity to evaluate the relevant economic, financial and
other information that we will use and consider in deciding whether or not to
enter into a particular transaction.
The scarcity of and competition for acquisition opportunities makes it
more difficult to complete acquisitions.
There are a limited number of operating companies available for
acquisition which we consider desirable. In addition, there is a high level of
competition among companies seeking to acquire these operating companies. A
large number of established and well-financed entities are active in acquiring
the type of companies we believe are desirable. Many of these entities have
significantly greater financial resources than we have. Consequently, we are at
a competitive disadvantage in negotiating and executing possible acquisitions of
these businesses. Even if we are able to successfully compete with these
entities, this competition may affect the terms of completed transactions and,
as a result, we may pay more than we expected for potential acquisitions. We may
find it difficult to identify operating companies that complement our strategy,
and even if we identify a company that complements our strategy, we may be
unable to complete an acquisition of such a company for many reasons, including:
o a failure to agree on the terms necessary for a transaction, such as
purchase price;
o incompatibility of operating strategies and management philosophies;
o competition from other acquirers of operating companies;
o insufficient capital to acquire a profitable logistics company; and
o the unwillingness of a potential acquiree to work with our management
or our affiliated companies.
If we are unable to successfully compete with other entities in
acquiring the companies we target, we will not be able to successfully implement
our business plan.
The issuance of additional securities may cause additional dilution to
the interests of our existing shareholders.
The additional financing required to fund our acquisition strategy may
require us to issue additional shares of common stock or common stock
equivalents to generate the required financing. For example, we recently issued
4,470,000 shares of our common stock in a private placement transaction that
closed on March 6, 2003. This issuance, plus any subsequent issuances of
securities, will further increase the number of shares outstanding and further
dilute the interests of our existing shareholders. We may issue more shares of
common stock for this purpose without prior notice to our shareholders.
We may also issue securities to, among other things, facilitate a
business combination, acquire assets or stock of another business, compensate
employees or consultants or for other valid business reasons in the discretion
of our Board of Directors, which could further dilute the interests of our
existing shareholders.
5
The exercise or conversion of our outstanding options, warrants or
other convertible securities or any derivative securities we issue in the future
will result in the dilution of the ownership interests of our existing
shareholders and may create downward pressure on the trading price of our common
stock.
We are currently authorized to issue 100,000,000 shares of common
stock. As of August 22, 2003, we have 29,617,211 outstanding shares. We may in
the future issue up to 16,577,672 additional shares of our common stock upon
exercise or conversion of existing outstanding convertible securities in
accordance with the following schedule:
Number of Shares Proceeds
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Upon conversion of our Series D Preferred Stock 3,607,450 $ --
Options granted under our Stock Option Plan 8,535,600 10,401,996
Non-Plan Options 2,010,100 3,453,750
Warrants 2,424,522 2,604,552
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Total 16,577,672 $16,460,298
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Even though the aggregate exercise of these securities could generate
material proceeds for us, the issuance of these additional shares would result
in the dilution of the ownership interests of our existing common shareholders
and the market price of our common stock could be adversely affected.
We rely on a small number of key customers, the loss of any of which
would have a negative effect on our results of operations.
Even though our customer base will likely diversify as we grow through
acquisitions, our customer base has been highly concentrated. For the year ended
December 31, 2002 our largest customer, Best Buy Co., Inc., a national retail
chain, accounted for approximately 29% of our total revenues. Our next five
largest customers accounted for approximately 21% of our total revenues, with
none of these customers accounting for 10% or more of our total revenues. We
believe the risk posed by this concentration is mitigated by our longstanding
and continuing relationships with these customers and we are confident that
these relationships will remain ongoing for the foreseeable future. We intend to
continue to provide superior service to all of our customers and have no
expectation that revenues from any of these customers will be reduced as a
result of any factors within our control. However, adverse conditions in the
industries of our customers could cause us to lose a significant customer or
experience a decrease in shipment volume. Either of these events could
negatively impact us. Our immediate plans, however, are to reduce our dependence
on any particular customer or customers by increasing our sales and customer
base by, among other things, diversifying our service offerings and continuing
with our growth strategy.
The risks associated with international operations could adversely
affect our operations and ability to grow outside of the United States.
A significant portion of our revenues is derived from our international
operations and the growth of those operations is an important part of our
business strategy. Our current international operations are focused on the
shipment of goods into and out of the United States and are dependent on the
volume of international trade with the United States. Our strategic plan
contemplates the growth of those operations as well as the expansion into the
transportation of goods wholly outside of the United States. The following
factors could adversely affect our current international operations as well as
the growth of those operations:
6
o the political and economic systems in certain international markets
are less stable than in the United States;
o wars, civil unrest, acts of terrorism and other conflicts exist in
certain international markets;
o export restrictions, tariffs, licenses and other trade barriers can
adversely affect the international trade serviced by our
international operations;
o managing distant operations with different local market conditions
and practices is more difficult than managing domestic operations;
o differing technology standards in other countries present
difficulties and incremental expense in integrating our services
across international markets;
o complex foreign laws and treaties can adversely affect our ability to
compete; and
o our ability to repatriate funds may be limited by foreign exchange
controls.
Terrorist attacks and other acts of violence or war may affect any
market on which our shares trade, the markets in which we operate, our
operations and our profitability.
Terrorist acts or acts of war or armed conflict could negatively affect
our operations in a number of ways. Primarily, any of these acts could result in
increased volatility in or damage to the U.S. and worldwide financial markets
and economy. They could also result in a continuation of the current economic
uncertainty in the United States and abroad. Acts of terrorism or armed
conflict, and the uncertainty caused by such conflicts, could cause an overall
reduction in worldwide sales of goods and corresponding shipments of goods. This
would have a corresponding negative effect on our operations. Also, terrorist
activities similar to the type experienced on September 11, 2001 could result in
another halt of trading of securities on the American Stock Exchange, which
could also have an adverse affect on the trading price of our shares and overall
market capitalization.
We depend on the continued service of certain executive officers. We
can not assure you that we will be able to retain these persons.
For the foreseeable future, our success will depend largely on the
continued services of our Chief Executive Officer, Dennis L. Pelino, as well as
the heads of our domestic and international service organizations, Gary Koch and
Jason Totah, because of their collective industry knowledge, marketing skills
and relationships with major vendors and customers. We have employment
agreements with each of these individuals which contain a non-competition
covenant which survives their actual term of employment. Nevertheless, should
any of these individuals leave the Company, it could have a material adverse
effect on our future results of operations.
We face intense competition in our industry.
The freight forwarding, logistics and supply chain management industry
is intensely competitive and is expected to remain so for the foreseeable
future. We face competition from a number of companies, including many that have
significantly greater financial, technical and marketing resources. There are a
large number of companies competing in one or more segments of the industry,
although the number of firms with a global network that offer a full complement
of freight forwarding and supply chain management services is more limited.
Depending on the location of the customer and the scope of services requested,
we must compete against both the niche players and larger entities. In addition,
customers increasingly are turning to competitive bidding situations involving
bids from a number of competitors, including competitors that are larger than we
are.
7
Our stock price may be volatile due to factors under, as well as out
of, our control.
The market price of our common stock could be highly volatile. Some
factors that may affect the market price include:
o actual or anticipated fluctuations in our operating results;
o announcements of technological innovations or new commercial
products or services by us or our competitors;
o a continued weakening of general market conditions which in turn
could have a depressive effect on the volume of goods shipped and
shipments that we manage or arrange;
o acts of global terrorism or armed conflicts; and
o changes in recommendations or earnings estimates by us or by
securities analysts.
Furthermore, the stock market has historically experienced volatility
which has particularly affected the market prices of securities of many
companies with a small market capitalization and which sometimes has been
unrelated to the operating performances of such companies.
Our cash flow may be adversely affected in the future once we fully
utilize our consolidated net operating loss carryforward.
Due to losses we incurred in our former business model, we have
accumulated a net operating loss carryforward for federal income tax purposes.
As of December 31, 2002, we expect that approximately $21.7 million of these
losses will be available to offset our taxable income until the losses are fully
utilized. Once these losses have been fully utilized, our cash flows will be
affected accordingly.
If we fail to improve our management information and financial
reporting systems, we may experience an adverse effect on our operations and
financial condition.
Our management information and financial reporting systems need to be
improved at the consolidated level. We may experience delays, disruptions and
unanticipated expenses in implementing, integrating and operating our
consolidated management information and financial reporting systems. Failure to
enhance these systems could delay our receipt of management and financial
information at the consolidated level which could disrupt our operations or
impair our ability to monitor our operations and have a negative effect on our
financial condition.
Because we are a holding company, we depend on receiving distributions
from our subsidiaries and we could be harmed if such distributions could not be
made in the future.
We are a holding company and all of our operations are conducted
through subsidiaries. Consequently, we rely on dividends or advances from our
subsidiaries. The ability of such subsidiaries to pay dividends and our ability
to receive distributions on our investments in other entities is subject to
applicable local law and other restrictions including, but not limited to,
applicable tax laws. Such laws and restrictions could limit the payment of
dividends and distributions to us which would restrict our ability to continue
operations.
8
We believe our industry is consolidating and if we cannot gain
sufficient market presence, we may not be able to compete successfully against
larger global companies.
We believe the marked trend within our industry is towards
consolidation of the niche players into larger companies which are attempting to
increase global operations through the acquisition of regional and local freight
forwarders. If we cannot gain sufficient market presence or otherwise establish
a successful strategy in our industry, we may not be able to compete
successfully against larger companies in our industry with global operations.
We may be required to incur material expenses in defending or resolving
outstanding lawsuits which would adversely affect our results of operations.
We are a defendant in a number of legal proceedings. Although we
believe that the claims asserted in these proceedings are without merit, and we
intend to vigorously defend these matters, we could incur material expenses in
the defense and resolution of these matters. Since we have not established any
reserves in connection with these claims, any such liability would be recorded
as an expense in the period incurred or estimated. This amount, even if not
material to our overall financial condition, could adversely affect our results
of operations in the period recorded.
We have a very limited operating history upon which you can evaluate
our prospects.
During 2001, we discontinued our former business model of developing
early-stage technology businesses, and adopted a new model of delivering
non-asset based third-party logistics services. The first acquisition under our
new business model occurred on October 5, 2001. Subsequent acquisitions were
completed during 2002 and 2003. As a result, we have a very limited operating
history under our current business model. Even though we are managed by senior
executives with significant experience in the industry, our limited operating
history makes it difficult to predict the longer-term success of our business
model.
Provisions of our charter and applicable Delaware law may make it more
difficult to complete a contested takeover of our Company.
Certain provisions of our certificate of incorporation and the General
Corporation Law of the State of Delaware (the "GCL") could deter a change in our
management or render more difficult an attempt to obtain control of us, even if
such a proposal is favored by a majority of our shareholders. For example, we
are subject to the provisions of the GCL that prohibit a public Delaware
corporation from engaging in a broad range of business combinations with a
person who, together with affiliates and associates, owns 15% or more of the
corporation's outstanding voting shares (an "interested shareholder") for three
years after the person became an interested shareholder, unless the business
combination is approved in a prescribed manner. Finally, our certificate of
incorporation includes undesignated preferred stock, which may enable our Board
of Directors to discourage an attempt to obtain control of us by means of a
tender offer, proxy contest, merger or otherwise.
9
FORWARD-LOOKING STATEMENTS
This prospectus includes forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. We have based these forward-looking statements on our
current expectations and projections about future events. These forward-looking
statements are subject to known and unknown risks, uncertainties and assumptions
about us and our subsidiaries that may cause our actual results, levels of
activity, performance or achievements to be materially different from any future
results, levels of activity, performance or achievements expressed or implied by
such forward-looking statements. In some cases, you can identify forward-looking
statements by terminology such as "may," "will," "should," "could," "would,"
"expect," "plan," "anticipate," "believe," "continue," "estimate," "project,"
"intend," or the negative of such terms or other similar expressions. You should
not place undue reliance on these forward-looking statements, which speak only
as of the date made. We undertake no obligation to publicly release the result
of any revision of these forward-looking statements to reflect events or
circumstances after the date they are made or to reflect the occurrence of
unanticipated events. You should also know that such statements are not
guarantees of future performance and are subject to risks, uncertainties and
assumptions. Many of these risks and uncertainties are set forth in the "Risk
Factors" section of this prospectus and in our other filings with the Securities
and Exchange Commission. Should any of these risks or uncertainties materialize,
or should any of our assumptions prove incorrect, actual results may differ
materially from those included within the forward-looking statements.
USE OF PROCEEDS
We will not receive any proceeds from the sale of common stock by the
selling shareholders. We may receive aggregate proceeds of up to $679,530 from
the exercise of the warrants held by the selling shareholders. We expect to use
the proceeds of any such exercises for general working capital purposes.
THE OFFERING
On or about March 6, 2003, we completed a private placement transaction
in which we issued 4,470,000 shares of our common stock for aggregate gross
proceeds of $6,072,500. The terms of the transaction required that we agree to
register for public resale the shares of common stock being offered for sale
under this prospectus.
Stonegate Securities, Inc. acted as placement agent in connection with
the private placement of 4,470,000 shares of common stock subject to this
prospectus. In connection therewith, Stonegate Securities, Inc. received
compensation consisting of a cash fee of $364,350 and representative's warrants
to purchase 297,000 shares of our common stock. These warrants were assigned to
the principals of Stonegate Securities, Inc. The representative's warrants may
be exercised in whole or in part, through February 2007 upon payment of an
exercise price of $1.49 per share. In addition to its representative's warrant,
Stonegate Securities, Inc. received an initial tranche of warrants to purchase
150,000 shares of our common stock on October 16, 2002 (also assigned to certain
of its principals). These warrants may be exercised, in whole or in part,
through November 16, 2005 upon payment of an exercise price of $1.23 per share.
75,000 shares included in this prospectus may be issued upon the
exercise of common stock warrants granted to Investec Inc. (as successor to
Pennsylvania Merchant Group) during March 2001.
10
These warrants were issued in connection with investment banking services
provided to us at the time, and may be exercised, in whole or in part, through
March 2006 upon payment of an exercise price of $.70 per share.
SELLING SHAREHOLDERS
The following table sets forth the name of the selling shareholders,
the number of shares of common stock beneficially owned by them as of the date
of this prospectus and the number of shares of our common stock which may be
offered for sale pursuant to this prospectus by the selling shareholders. The
table also sets forth any material relationship between the Company and each
selling shareholder based upon information currently available to the Company
and the number of shares beneficially owned and the percentage ownership of each
selling shareholder after the offering. The number of shares set forth in this
table includes 522,000 shares that may be issuable upon the exercise of common
stock warrants. This table has been prepared based on the assumption that
29,617,211 shares of common stock will be outstanding as of the date of this
prospectus.
The information in this table assumes that all of the shares held by
each selling shareholder and being offered under this prospectus are sold to
persons who are not affiliates of such selling shareholder, and that each
selling shareholder acquires no additional shares of common stock before the
completion of this offering.
Number of Number of
Shares of Percentage Number of Shares of Percentage
Common Stock Before Shares Offered Common Stock After
Name Before Offering Offering Hereby After Offering Offering
---- --------------- -------- -------------- -------------- ---------
A. Spector Capital, LLC
801 S. Rampart - Suite 200
Las Vegas, NV 89145 500,000 1.69% 500,000 -0- -0-
Atlas Capital (Q.P.), L.P.
100 Crescent Court #880 59,025 (*) 59,025 -0- -0-
Dallas, TX 75201
Atlas Capital Master Fund, Ltd.
100 Crescent Court #880 190,975 (*) 190,975 -0- -0-
Dallas, TX 75201
BFS US Special Opportunities Trust PLC
8080 N. Central Expressway
Suite 210 - LB-59
Dallas, TX 75206 400,000 1.35% 400,000 -0- -0-
11
George B. Clairmont 5-8-51 Trust
950 Third Avenue - 9th Fl.
New York, NY 10022 (*) 60,000 34,000 (*)
94,000
George B. Clairmont
950 Third Avenue - 9th Fl.
New York, NY 10022 94,000 (*) 60,000 34,000 (*)
Crestview Capital Fund I, L.P.
95 Revere Drive, Suite F 185,000 (*) 185,000 -0- -0-
Northbrook, IL 60062
Crestview Capital Fund II, L.P.
95 Revere Drive, Suite F 235,000 (*) 235,000 -0- -0-
Northbrook, IL 60062
Crestview Capital Offshore Fund, Inc.
95 Revere Drive, Suite F 30,000 (*) 30,000 -0- -0-
Northbrook, IL 60062
Scott R. Griffith SEP IRA
5950 Sherry Lane, Suite 410 31,800 (*) 31,800 -0- -0-
Dallas, TX 75225
Scott R. Griffith
5950 Sherry Lane, Suite 410 149,000 (*) 149,000 -0- -0-
Dallas, TX 75225 (1)
Gryphon Master Fund, LP
500 Crescent Ct. #270 200,000 (*) 200,000 -0- -0-
Dallas, TX 75201
Ingleside Company
707 Westchester Avenue
Suite 405 200,000 (*) 200,000 -0- -0-
White Plains, NY 10604
Investec Inc.
Four Falls Corporate Center
West Conshohocken, PA 19428-296 75,000 (*) 75,000 -0- -0-
12
London Family Trust
212 Aurora Drive
Montecito, CA 93108 (2) 274,000 (*) 224,000 50,000 (*)
MidSouth Investor Fund LP
1776 Peachtree St. NW
Suite 412 North
Atlanta, GA 30309 100,000 (*) 100,000 -0- -0-
Oberweis Micro-Cap Portfolio
951 Ice Cream Drive
Suite 200 200,000 (*) 100,000 100,000 (*)
North Aurora, IL 60542
Dennis L. Pelino
1500 Ocean Drive
Suite 1201 2,506,222 7.90% 100,000 2,406,222 7.59%
Miami Beach, FL 33139 (3)
Ponte Vedra Partners Ltd.
1548 The Greens Way 200,000 (*) 100,000 100,000 (*)
Jacksonville, FL 32250
Renaissance US Growth Investment Trust
PLC
8080 N. Central Expressway 200,000 (*) 200,000 -0- -0-
Suite 210 - LB-59
Dallas, TX 75206
Renaissance Capital Growth & Income
Fund III, Inc.
8080 N. Central Expressway 200,000 (*) 200,000 -0- -0-
Suite 210-LB-59
Dallas, TX 75206
SBL Fund Series V
One Security Benefit Place 520,000 1.76% 520,000 -0- -0-
Topeka, KS 66636
Security Equity Fund - Mid Cap Value
Series
One Security Benefit Place 480,000 1.62% 480,000 -0- -0-
Topeka, KS 66636
13
Jesse B. Shelmire
5950 Sherry Lane, Suite 410 149,000 (*) 149,000 -0- -0-
Dallas, TX 75225 (1)
Sherleigh Associates Inc.
Profit Sharing Plan, Jack Silver
Trustee
920 Fifth Avenue #3B 1,010,000 3.41% 400,000 610,000 2.06%
New York, NY 11221
Stonegate Securities, Inc.
5950 Sherry Lane, Suite 410
Dallas, TX 75225 43,200 (*) 43,200 -0- -0-
------------- -------------
4,992,000
=============
* Less than one percent.
------------------------
(1) Represents shares issuable upon exercise of warrants.
(2) Includes 149,000 shares issuable upon exercise of warrants.
(3) Includes 406,222 shares and 2,100,000 shares of common stock issuable
upon exercise of vested options. Does not include 2,300,000 shares of
common stock issuable pursuant to options not presently exercisable and
not exercisable within 60 days of August 22, 2003.
PLAN OF DISTRIBUTION
The outstanding securities covered by this prospectus and the common
stock purchase warrants under which shares of common stock covered by this
prospectus are issuable, were purchased or acquired by the selling shareholders
in the ordinary course of their business. At the time the outstanding securities
and common stock warrants were purchased or acquired by the selling
shareholders, the selling shareholders had no agreements, understandings,
directly or indirectly, with any person to distribute the outstanding securities
or the securities issuable upon exercise of the common stock warrants. The
selling shareholders, or their respective pledges, donees, transferees, or any
of their successors in interest selling shares received from a named selling
shareholder as a gift, partnership distribution or other non-sale related
transfer after the date of this prospectus (all of whom may be selling
shareholders), may sell the securities from time to time on any stock exchange
or automated interdealer quotation system on which the securities are listed or
quoted, in the over-the-counter market, in privately negotiated transactions or
otherwise, at fixed prices that may be changed, at market prices prevailing at
the time of sale, at prices related to prevailing market prices or at prices
otherwise negotiated.
The selling shareholders may sell the securities by one or more of the
following methods, without limitation:
o block trades in which the broker or dealer so engaged will attempt to
sell the securities as agent but may purchase and resell a portion of
the block as principal to facilitate the transaction;
o purchases by a broker or dealer as principal and resale by the broker
or dealer for its own account pursuant to this prospectus, including
resale to another broker or dealer;
o an exchange distribution in accordance with the rules of any stock
exchange on which the securities are listed;
14
o ordinary brokerage transactions and transactions in which the broker
solicits purchases;
o privately negotiated transactions;
o short sales;
o through the writing of options on the securities, whether or not the
options are listed on an options exchange;
o through the distribution of the securities by any selling
shareholders to its partners, members or stockholders;
o one or more underwritten offerings on a firm commitment or best
efforts basis; and
o any combination of any of these methods of sale.
The distribution of the shares may be effected from time to time in one
or more transactions at a fixed price or prices, which may be changed, at market
prices prevailing at the time of sale, at prices related to such prevailing
market prices or at negotiated prices. We do not know of any arrangements by the
selling shareholders for the sale of any of the securities.
The selling shareholders may engage brokers and dealers, and any
brokers or dealers may arrange for other brokers or dealers to participate in
effecting sales of the securities. These brokers, dealers or underwriters may
act as principals, or as an agent of a selling shareholder. Broker-dealers may
agree with a selling shareholder to sell a specified number of the securities at
a stipulated price per security. If the broker-dealer is unable to sell
securities acting as agent for a selling shareholder, it may purchase as
principal any unsold securities at the stipulated price. Broker-dealers who
acquire securities as principals may thereafter resell the securities from time
to time in transactions in any stock exchange or automated interdealer quotation
system on which the securities are then listed or quoted, at prices and on terms
then prevailing at the time of sale, at prices related to the then-current
market price or in negotiated transactions. Broker-dealers may use block
transactions and sales to and through broker-dealers, including transactions of
the nature described above. Assuming that required holding periods and other
criteria are satisfied, the selling shareholders may also sell the securities in
accordance with Rule 144 under the Securities Act of 1933 rather than pursuant
to this prospectus, regardless of whether the securities are covered by this
prospectus.
To the extent required under the Securities Act of 1933, the aggregate
amount of any selling shareholder securities being offered and the terms of the
offering, the names of any agents, brokers, dealers or underwriters and any
applicable commission with respect to a particular offer will be set forth in a
post-effective amendment or an accompanying prospectus supplement. Any
underwriters, dealers, brokers or agents participating in the distribution of
the securities may receive compensation in the form of underwriting discounts,
concessions, commissions or fees from a selling shareholder and/or purchasers of
selling shareholders' securities, for whom they may act (which compensation as
to a particular broker-dealer might be in excess of customary commissions).
The selling shareholders and any underwriters, brokers, dealers or
agents that participate in the distribution of the securities may be deemed to
be "underwriters" within the meaning of the Securities Act of 1933, and any
discounts, concessions, commissions or fees received by them and any profit on
the resale of the securities sold by them may be deemed to be underwriting
discounts and commissions.
15
The selling shareholders may enter into hedging transactions with third
parties, which may in turn engage in short sales of the securities in the course
of hedging the position they assume. The selling shareholders may also enter
into short positions or other derivative transactions relating to the
securities, or interests in the securities, and deliver the securities, or
interests in the securities, to close out their short or other positions or
otherwise settle short sales or other transactions, or loan or pledge the
securities, or interests in the securities, to third parties that in turn may
dispose of these securities.
We have agreed to indemnify in certain circumstances certain of the
selling shareholders against certain liabilities, including liabilities under
the Securities Act of 1933. The selling shareholders have agreed to indemnify us
in certain circumstances against certain liabilities, including liabilities
under the Securities Act of 1933. Insofar as we are permitted to indemnify the
selling shareholders for liabilities arising under the Securities Act of 1933,
we have been advised that in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed in the
Securities Act of 1933 and is unenforceable.
The selling shareholders and other persons participating in the sale or
distribution of the securities will be subject to applicable provisions of the
Securities Exchange Act of 1934, and the rules and regulations thereunder,
including Regulation M. Under those rules and regulations, they
o may not engage in any stabilization activity in connection with our
securities;
o must furnish each broker which offers common stock covered by this
prospectus with the number of copies of this prospectus which are
required by each broker; and
o may not bid for or purchase any of our securities or attempt to
induce any person to purchase any of our securities other than as
permitted under the Securities Exchange Act of 1934.
We will not receive any proceeds from the sale of the shares. We will
pay the expenses of preparing this prospectus and the related registration
statement.
We can not assure you that the selling shareholders will sell all or
any portion of the securities offered hereby.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, as well as proxy
statements and other information with the Securities and Exchange Commission.
You may read and copy any document we file with the SEC at the SEC's Public
Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. You may obtain
further information about the operation of the Public Reference Room by calling
the SEC at 1-800-SEC-0330. Our SEC filings are also available to the public over
the Internet at the SEC's web site at http://www.sec.gov, which contains
reports, proxy statements and other information regarding registrants like us
that file electronically with the SEC.
This prospectus is part of a registration statement on Form S-3 filed
by us with the SEC under the Securities Act of 1933. As permitted by SEC rules,
this prospectus does not contain all of the information included in the
registration statement and the accompanying exhibits filed with the SEC. You may
refer to the registration statement and its exhibits for more information.
16
The SEC allows us to "incorporate by reference" into this prospectus
the information we file with the SEC. This means that we can disclose important
information to you by referring you to those documents. The information
incorporated by reference is considered to be part of this prospectus. If we
subsequently file updating or superseding information in a document that is
incorporated by reference into this prospectus, the subsequent information will
also become part of this prospectus and will supersede the earlier information.
We are incorporating by reference the following documents that we have
filed with the SEC:
o our Annual Report on Form 10-K for the year ended December 31, 2002,
as amended by Form 10-K/A filed with the SEC on August 28, 2003;
o our Quarterly Report on Form 10-Q for the quarter ended March 31,
2003, as amended by Form 10-Q/A filed with the SEC on August 28,
2003;
o our Quarterly Report on Form 10-Q for the quarter ended June 30,
2003, as amended by Form 10-Q/A filed with the SEC on August 28,
2003;
o our Current Reports on Form 8-K and 8-K/A as filed with the SEC on
February 4, 2003, May 8, 2003, July 17, 2003, August 7, 2003, August
13, 2003, August 15, 2003 and August 28, 2003; and
o the description of our common stock, $.001 par value per share,
contained in our registration statement on our amended Form 8-A filed
pursuant to Section 12(b) of the Securities Exchange Act of 1934,
dated June 29, 2001, and any subsequent amendments or reports filed
for the purpose of updating such description.
We are also incorporating by reference into this prospectus all of our
future filings with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934 until this offering has been completed.
You may obtain a copy of any of our filings which are incorporated by
reference, at no cost, by contacting us at:
Stonepath Group, Inc.
1600 Market Street, Suite 1515
Philadelphia, PA 19103
Attention: Stephen M. Cohen,
Senior Vice President and General Counsel
Telephone: (215) 979-8370
You should rely only on the information contained in or incorporated by
reference in this prospectus. We have not authorized anyone to provide you with
different information. We are not making an offer of these securities in any
state where the offer is not permitted. You should not assume that the
information provided by this prospectus is accurate as of any date other than
the date on the front of this prospectus. If we subsequently file updating or
superseding information in a document that is incorporated by reference into
this prospectus, the subsequent information will also become part of this
prospectus and will supersede the earlier information.
17
LEGAL MATTERS
The validity of the shares being issued will be passed upon for the
Company by Buchanan Ingersoll Professional Corporation, 11 Penn Center, 14th
Floor, 1835 Market Street, Philadelphia, PA 19103.
EXPERTS
The consolidated financial statements and schedule of the Company as of
December 31, 2002 and 2001, and for each of the years in the three-year period
ended December 31, 2002, have been incorporated by reference herein and in the
registration statement in reliance upon the report of KPMG LLP, independent
accountants, incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing. The audit report contains an
explanatory paragraph that states that the Company has restated its consolidated
financial statements as of and for the years ended December 31, 2002 and 2001.
The combined financial statements of M.G.R., Inc. d/b/a Air Plus
Limited, Distribution Services, Inc., and Contract Air, Inc. for the
year ended December 31, 2000 have been incorporated by reference herein and in
the registration statement in reliance upon the report of KPMG LLP, independent
accountants, incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing.
The financial statements of Regroup Express, LLC as of December 31,
2002 and 2001, and for the years then ended, have been incorporated by reference
herein and in the registration statement in reliance upon the report of KPMG
LLP, independent accountants, incorporated by reference herein, and upon the
authority of said firm as experts in accounting and auditing.
The financial statements of G-Link Express Pte. Ltd. as of and for the
year ended December 31, 2002, have been incorporated by reference herein and in
the registration statement in reliance upon the report of Ho, Sneddon, Chui,
independent accountants, incorporated by reference herein, and upon the
authority of said firm as experts in accounting and auditing.
The financial statements of G-Link Express (Cambodia) Pte. Ltd. as of
and for the year ended December 31, 2002, have been incorporated by reference
herein and in the registration statement in reliance upon the report of Ho,
Sneddon, Chui, independent accountants, incorporated by reference herein,
and upon the authority of said firm as experts in accounting and auditing.
18
Stonepath Group, Inc.
4,992,000 Shares of Common Stock
------------------
PROSPECTUS
------------------
We have not authorized any dealer, salesperson or other person to give
any information or represent anything contained in this prospectus. You must not
rely on any unauthorized information. This prospectus does not offer to sell nor
does it solicit to buy any shares of common stock in any jurisdiction where it
is unlawful. The information in this prospectus is current as of August 28,
2003.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following is an estimate of the expenses which will be incurred by
the Company in connection with the issuance and distribution of the securities
being registered.
SEC filing fee............................................. $ 715
Legal fees and expenses.................................... 35,000
Accounting fees and expenses............................... 25,000
Miscellaneous expenses..................................... 10,000
-------
Total................................................... $70,715
=======
Item 15. Indemnification of Directors and Officers
Our certificate of incorporation and bylaws reflect the adoption of the
provisions of Section 102(b)(7) of the Delaware General Corporation Law, which
eliminate or limit the personal liability of a director to our stockholders or
us for monetary damages for breach of fiduciary duty under certain
circumstances. If applicable Delaware law is amended to authorize corporate
action further eliminating or limiting personal liability of directors, our
certificate of incorporation provides that the liability of a director shall be
eliminated or limited to the fullest extent permitted by applicable Delaware
law.
Our certificate of incorporation and bylaws also provide that we shall
indemnify any person who was or is a party to a proceeding by reason of the fact
that he is or was a director, officer, employee or agent of ours, or is or was
serving at our request as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against
expenses (including judgments, fines, amounts paid in settlement and attorneys'
fees) actually and reasonably incurred by such person in connection with a
proceeding if such person acted in good faith and in a manner he reasonably
believed to be in or not opposed to our best interests, in accordance with, and
to the full extent permitted by, applicable Delaware law. The determination of
whether indemnification is proper under the circumstances, unless made by a
court, shall be determined by the board of directors.
We maintain, at our expense, an insurance policy which insures our
directors and officers, subject to certain exclusions and deductions as are
usual in such insurance policies, against certain liabilities which may be
incurred in those capacities.
II-1
Item 16. Exhibits
The following is a complete list of Exhibits filed as part of this
Registration Statement, which are incorporated herein:
Exhibit No. Reference
---------- ---------
4.19 Form of subscription agreement by and between the Company and certain holders of
common shares (including exhibit providing for registration rights) (1)
4.20 Placement Agency Agreement between the Company and Stonegate Securities, Inc.
dated October 16, 2002 (1)
4.24 Form of Initial Warrants issued to Stonegate Securities, Inc. as of October 16,
2002 (2)
4.25 Form of Representative's Warrants issued to Stonegate Securities, Inc. as of March
6, 2003 (2)
4.26 Warrant for the purchase of shares of common stock granted to Pennsylvania
Merchant Group dated March 6, 2001 (2)
5.1 Opinion of Buchanan Ingersoll Professional Corporation Filed herewith
23.1 Consent of KPMG LLP Filed herewith
23.2 Consent to KPMG LLP Filed herewith
23.3 Consent of KPMG LLP Filed herewith
23.4 Consent of Ho, Sneddon, Chui Filed herewith
23.5 Consent of Ho, Sneddon, Chui Filed herewith
23.6 Consent of Buchanan Ingersoll Professional Corporation (included in its opinion Filed herewith
on Exhibit 5.1)
24.1 Power of Attorney (included on the signature page of the registration statement) Filed herewith
-------------------
(1) Incorporated by reference to the Company's Annual Report on Form
10-K for the year ended December 31, 2002, as filed on March 31, 2003.
(2) Filed with the Company's Registration Statement on Form S-3 (No.
333-104228) on April 1, 2003.
II-2
Item 17. Undertakings
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the information
set forth in the Registration Statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) above do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by us pursuant to Section 13
or Section 15(d) of the Exchange Act that are incorporated by reference in the
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the Registrant's annual report pursuant
to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(5) 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 informed that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act of 1933 and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question of whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing this registration statement on Form S-3 and has
duly caused this Amendment No. 2 to Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of
Philadelphia, Commonwealth of Pennsylvania, on August 25 2003.
STONEPATH GROUP, INC.
By: Dennis L. Pelino
------------------------------------------
Dennis L. Pelino (Chairman of the Board
of Directors and Chief Executive Officer)
By: Bohn H. Crain
------------------------------------------
Bohn H. Crain (Chief Financial Officer)
By: Thomas L. Scully
------------------------------------------
Thomas L. Scully (Principal
Accounting Officer)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature
appears below constitutes and appoints Stephen M. Cohen his true and lawful
attorney-in-fact and agent with full power of substitution and revocation, for
him and in his name, place and stead, in any and all capacities, to sign any and
all amendments to this Registration Statement (including post-effective
amendments), and to file the same with all exhibits thereto, and all documents
in connection therewith, with the Securities and Exchange Commission, granting
unto said attorney-in-fact and agent 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, hereby ratifying and confirming all that said attorney-in-fact and agent
or his substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
II-4
Pursuant to the requirements of the Securities Act of 1933, this
Amendment No. 2 to Registration Statement has been signed by the following
person in the capacity indicated on August__, 2003.
Signature Title Date
--------- ----- ----
/s/ Dennis L. Pelino Chairman, Chief Executive August 25, 2003
------------------------------------ Officer and Director
Dennis L. Pelino
* Director August 25, 2003
------------------------------------
J. Douglass Coates
/s/ John Springer Director August 25, 2003
---------------------------
John Springer
* Director August 25, 2003
------------------------------------
Aloysius T. Lawn IV
* Director August 25, 2003
------------------------------------
Robert McCord
* Director August 25, 2003
------------------------------------
David Jones
*By: /s/ Stephen M. Cohen
--------------------------------
Attorney-in-fact
II-5
EXHIBIT INDEX
Exhibit No. Reference
----------- ---------
5.1 Opinion of Buchanan Ingersoll Professional Corporation
23.1 Consent of KPMG LLP
23.2 Consent of KPMG LLP
23.3 Consent of KPMG LLP
23.4 Consent of Ho, Sneddon, Chui
23.5 Consent of Ho, Sneddon, Chui
23.6 Consent of Buchanan Ingersoll Professional Corporation
(included in its opinion on Exhibit 5.1)
24.1 Power of Attorney (included on the signature page of the
registration statement)