-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PhY+YI9adz57P4gUSgVkETRo1M/psbyKT6WvDgY4kE3bY2+/weFPFBa2InsnAfXO tvM58NpyH/ZgxMEQtq+x7w== 0000950124-97-000161.txt : 19970708 0000950124-97-000161.hdr.sgml : 19970708 ACCESSION NUMBER: 0000950124-97-000161 CONFORMED SUBMISSION TYPE: S-3/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 19970116 DATE AS OF CHANGE: 19970707 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: USFREIGHTWAYS CORP CENTRAL INDEX KEY: 0000881791 STANDARD INDUSTRIAL CLASSIFICATION: 4213 IRS NUMBER: 363790696 STATE OF INCORPORATION: DE FISCAL YEAR END: 1230 FILING VALUES: FORM TYPE: S-3/A SEC ACT: 1933 Act SEC FILE NUMBER: 333-19637 FILM NUMBER: 97506701 BUSINESS ADDRESS: STREET 1: 9700 HIGGINS RD STE 570 CITY: ROSEMONT STATE: IL ZIP: 60018 BUSINESS PHONE: 8476960200 MAIL ADDRESS: STREET 1: 9700 HIGGINS ROAD SUITE 570 CITY: ROSEMONT STATE: IL ZIP: 60018 FORMER COMPANY: FORMER CONFORMED NAME: TNT FREIGHTWAYS CORP DATE OF NAME CHANGE: 19930328 S-3/A 1 AMENDMENT NO. 1 TO FORM S-3 1 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 16, 1997 REGISTRATION STATEMENT NO. 333-19637 - - -------------------------------------------------------------------------------- - - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------- AMENDMENT NO. 1 TO FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------------- USFREIGHTWAYS CORPORATION (Exact name of registrant as specified in its charter) DELAWARE 36-3790696 (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification No.)
9700 HIGGINS ROAD, SUITE 570, ROSEMONT, ILLINOIS 60018 (847) 696-0200 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) ------------------------- JOHN CAMPBELL CARRUTH USFREIGHTWAYS CORPORATION 9700 HIGGINS ROAD, SUITE 570 ROSEMONT, ILLINOIS 60018 (847) 696-0200 (Name, address, including zip code, and telephone number, including area code, of agent for service) ------------------------- Copies to: WILLIAM N. WEAVER, JR. ROBERT F. WALL MISTY S. GRUBER R. CABELL MORRIS, JR. SACHNOFF & WEAVER, LTD. WINSTON & STRAWN 30 S. WACKER DRIVE, 29TH FLOOR 35 W. WACKER DRIVE, SUITE 4200 CHICAGO, ILLINOIS 60606-7484 CHICAGO, ILLINOIS 60601 TELEPHONE NO. (312) 207-1000 TELEPHONE NO. (312) 558-5600
------------------------- APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as practicable 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 to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. [ ] 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 prospectus is expected to be made pursuant to Rule 434, please check the following box. [ ] 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 THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. - - -------------------------------------------------------------------------------- - - -------------------------------------------------------------------------------- 2 INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE. SUBJECT TO COMPLETION, DATED JANUARY 16, 1997 PROSPECTUS 2,700,000 SHARES [USFREIGHTWAYS LOGO] USFREIGHTWAYS CORPORATION COMMON STOCK ($.01 PAR VALUE) ------------------------ This Prospectus covers 2,700,000 shares of common stock, par value $.01 per share (the "Common Stock") of USFreightways Corporation (the "Company"). The Common Stock is traded on the Nasdaq National Market under the symbol "USFC." On January 15, 1997, the last reported sale price of the Common Stock on the Nasdaq National Market was $26 1/4 per share. See "Price Range of Common Stock." SEE "RISK FACTORS" BEGINNING ON PAGE 10 FOR A DISCUSSION OF CERTAIN MATTERS THAT SHOULD BE CONSIDERED BY POTENTIAL INVESTORS. ------------------------ THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- - -------------------------------------------------------------------------------------------------- - - -------------------------------------------------------------------------------------------------- PRICE TO PROCEEDS TO PUBLIC UNDERWRITING COMPANY(2) DISCOUNT(1) - - -------------------------------------------------------------------------------------------------- Per Share........................ $ $ $ - - -------------------------------------------------------------------------------------------------- Total(3)......................... $ $ $ - - -------------------------------------------------------------------------------------------------- - - --------------------------------------------------------------------------------------------------
(1) The Company has agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933. See "Underwriting." (2) Before deducting offering expenses payable by the Company estimated at $245,496.00. (3) The Company has granted the Underwriters a 30-day option to purchase up to 405,000 additional shares of Common Stock solely to cover over-allotments, if any. If the Underwriters exercise this option in full, the total Price to Public, Underwriting Discount and Proceeds to Company will be $ , $ , and $ , respectively. See "Underwriting." ------------------------ The shares of Common Stock are offered subject to receipt and acceptance by the Underwriters, to prior sale and to the Underwriters' right to reject any order in whole or in part and to withdraw, cancel or modify the offer without notice. It is expected that delivery of share certificates will be made at the offices of Merrill Lynch & Co., New York, New York on or about , 1997. ------------------------ MERRILL LYNCH & CO. SCHRODER WERTHEIM & CO. ------------------------ The date of this Prospectus is , 1997. 3 [Map of Regional Areas] IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY ENGAGE IN PASSIVE MARKET TRANSACTIONS IN THE COMMON STOCK OF THE COMPANY ON THE NASDAQ NATIONAL MARKET IN ACCORDANCE WITH RULE 10B-6A UNDER THE SECURITIES EXCHANGE ACT OF 1934. SEE "UNDERWRITING." IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE COMMON STOCK OF THE COMPANY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NASDAQ NATIONAL MARKET, IN THE OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. 4 AVAILABLE INFORMATION The Company has filed a Registration Statement on Form S-3 under the Securities Act of 1933, as amended (the "Securities Act"), with the Securities and Exchange Commission (the "Commission") with respect to the shares offered by this Prospectus. This Prospectus does not contain all of the information set forth in the Registration Statement and the exhibits and schedules thereto. Statements contained herein concerning the provisions of any documents are not necessarily complete and, in each instance, reference is made to the copy of such documents filed as an exhibit to the Registration Statement, and each such statement shall be deemed qualified in its entirety by such reference. The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "1934 Act"), and in accordance therewith files reports, proxy statements and other information with the Commission. Such reports, proxy statements and other information filed by the Company with the Commission may be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the following Regional Offices of the Commission: Northeast Regional Office, 7 World Trade Center, Suite 1300, New York, New York 10048; and Midwest Regional Office, Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such material can also be obtained from the Public Reference Section of the Commission, at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. The Company is subject to the electronic filing requirements of the Commission. Accordingly, pursuant to the rules and regulations of the Commission, certain documents, including annual and quarterly reports and proxy statements, filed by the Company with the Commission have been or will be filed electronically. The Commission maintains a World Wide Web site that contains reports, proxy and information statements and other information regarding registrants that file electronically with the Commission at http://www.sec.gov. The Company's Common Stock is listed on the Nasdaq National Market under the symbol USFC, and such reports, proxy statements and other information can also be inspected at the offices of the Nasdaq National Market, Reports Section, 1735 Street, N.W., Washington, D.C. 20006. This Prospectus does not contain all the information set forth in the Registration Statement and exhibits thereto which the Company has filed with the Commission under the Securities Act. INFORMATION INCORPORATED BY REFERENCE The Company's Annual Report on Form 10-K for the fiscal year ended December 30, 1995, the Company's Quarterly Reports on Form 10-Q for the quarters ended March 30, 1996, June 29, 1996, September 28, 1996, the Company's Current Report on Form 8-K dated as of January 7, 1997, and the description of the Company's Common Stock contained in the Company's Registration Statement on Form 8-A declared effective February 12, 1992, each of which has been filed with the Commission, are incorporated by reference in this Prospectus. All documents filed by the Company with the Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the 1934 Act subsequent to the date of this Prospectus and prior to the termination of the offering of the Common Stock registered hereby shall be deemed to be incorporated by reference into this Prospectus and to be a part hereof from the respective dates of filing of such documents. Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified and superseded, to constitute a part of this Prospectus. The Company will provide without charge to each person to whom this Prospectus is delivered, upon written or oral request of such person, a copy of any and all of the information that has been incorporated by reference in this Prospectus, excluding exhibits. Such requests should be directed to USFreightways Corporation, 9700 Higgins Road, Suite 570, Rosemont, Illinois 60018, Attention: Senior Vice President, Finance. Telephone: (847) 696-0200. 3 5 PROSPECTUS SUMMARY The following summary is qualified in its entirety by the more detailed information (including the consolidated financial statements and the notes thereto) included elsewhere in this Prospectus and incorporated by reference herein. Potential investors should carefully consider the factors set forth in the section entitled "Risk Factors" and are urged to read this Prospectus in its entirety. Unless otherwise indicated, all information contained in this Prospectus assumes no exercise of the Underwriters' over-allotment option. See "Underwriting." THE COMPANY OVERVIEW USFreightways Corporation (the "Company") is a leader in the regional less than truckload ("LTL") general transportation business. The Company owns a group of five regional, general commodities motor carriers, which focuses on overnight and second-day freight delivery and provides service throughout the continental United States, Hawaii, Alaska, and to certain points in Canada. Over 70% of the Company's regional shipments are delivered within one day and over 95% within two days. The Company's logistics subsidiaries provide specialized and dedicated services in management and distribution. For the fiscal year ended December 30, 1995, the Company generated $1.14 billion of consolidated operating revenue and $67.5 million of income from operations. During the four year period ended December 30, 1995, operating revenue and income from operations grew at a compound annual rate of 15.2% and 25.3%, respectively. Management believes that its growth to date and prospects reflect a strategy that capitalizes on evolving trends in the transportation industry. Typically, LTL carriers transport freight along scheduled routes from multiple shippers to multiple consignees utilizing a network of terminals, together with fleets of line-haul and pick-up and delivery tractors and trailers. Freight is picked up from customers by local drivers and consolidated for shipment. The freight is then loaded into intercity trailers and transferred by line-haul drivers to the terminal servicing the delivery area. There, the freight is transferred to local trailers and delivered to its destination by local drivers. At December 28, 1996, the Company maintained 239 terminals. During the year ended December 28, 1996, the Company transported 11.6 million shipments through the use of approximately 22,000 pieces of revenue equipment. With these capital assets, management believes the Company is able to effectively compete in the $19 billion LTL market, as estimated by Cass Information Systems. LTL operators are generally categorized as regional, interregional or long-haul carriers, depending on the distance freight travels from pick-up to final delivery. Regional carriers usually have average lengths of haul of 500 miles or less and tend to provide either overnight or second-day service. Regional LTL carriers usually are able to load freight for direct transport to a destination terminal, thereby avoiding the costly and time-consuming use of breakbulk terminals (where freight is rehandled and reloaded to its ultimate destination). In contrast, long-haul LTL carriers (average lengths of haul in excess of 1,000 miles) operate networks of breakbulk and satellite terminals (hub and spoke systems) and rely heavily on interim handling of freight. Interregional carriers (500 to 1,000 miles per average haul) also rely on breakbulk terminals but to a lesser degree than long-haul carriers. Management believes that the regional LTL segment is the most attractive segment of the LTL trucking industry both because customer distribution strategies have shifted over time thereby increasing demand, and regional carriers tend to be more cost competitive for this type of freight. Whereas in the past shippers would send multiple shipments to multiple ultimate consignees throughout the country via long-haul LTL carriers, they are increasingly sending large quantities to a few distribution centers by truckload carriers and then shipping to the ultimate consignees via regional LTL carriers. Also, freight in general is moving over shorter distances. Management's industry information indicates that approximately 70% of all general freight today is shipped 500 miles or less. Furthermore, management believes the regional LTL market has attractive growth prospects, as significant barriers to entry exist, thereby reducing competition from new entrants, due to (i) the 4 6 substantial capital requirements for terminals and revenue equipment and (ii) the need for a large, well-coordinated and skilled work force. The Company is one of the largest regional LTL operators, having developed a network of regional carriers throughout the United States, while retaining and enhancing overall profitability. Management remains firmly committed to increasing operating profitability and enhancing shareholder value. The table below details the operating performance of the Company's regional carriers and logistics operations. REVENUE AND OPERATING RATIOS UNAUDITED (DOLLARS IN THOUSANDS)
OPERATING REVENUE OPERATING RATIO(a) ------------------- ------------------- OPERATING REVENUE OPERATING RATIO(A) ------------------- ------------------- THREE MONTHS ENDED NINE MONTHS ENDED ----------------------------------------- ----------------------------------------- 09/30/95 09/28/96 09/30/95 09/28/96 09/30/95 09/28/96 09/30/95 09/28/96 -------- -------- -------- -------- -------- -------- -------- -------- OPERATING COMPANY (REGION) USF Holland (Midwest)............. $131,280 $153,725 91.9% 90.6% $397,250 $440,800 91.4% 91.4% USF Red Star (Northeast)........... 50,778 48,571 102.2 101.6 149,580 147,961 100.0 102.8 USF Reddaway (West Coast, Northwest)..... 43,395 46,383 90.6 92.2 121,666 132,506 92.6 94.6 USF Bestway (Southwest)........... 27,184 28,416 90.9 88.9 80,297 84,321 90.3 89.4 USF Dugan (Plains, South)(b)............. 19,304 38,543 93.6 96.1 57,099 111,755 92.5 97.8 Logistics Operations.... 16,798 22,969 94.8 94.7 46,852 62,073 95.4 97.3 Other................... 1,225 4,596 3,336 9,581 -------- -------- -------- -------- Total Operating Revenue............... $289,964 $343,203 $856,080 $988,997 ======== ======== ======== ======== Income from Operations............ $ 17,326 $ 22,528 $ 53,225 $ 50,171 ======== ======== ======== ========
- - ------------------------- (a) Operating ratio is operating expenses as a percentage of operating revenue. (b) Includes revenues resulting from the acquisition of the general commodities business of Transus, Inc., effective as of January 1, 1996. The Company believes that the increase in the demand for regional LTL transportation services is a result of two market phenomena: (i) an increase in shippers' desire to reduce costs in their supply chain; and (ii) an increase in customers' material and inventory turnover. Shippers are increasingly using regional distribution centers, consolidating or eliminating warehouses and adopting other just-in-time or quick response distribution practices ("JIT/QR"). Industry sources estimate that the percentage of goods moved in the United States using JIT/QR as a percentage of the total is expected to be approximately 35% in 1997, a three-fold increase from the 13% of goods moved using such practices in 1990. The Company has addressed these changes in the patterns of distribution by forming two operating entities, Comet Transport and Logix, to respond to customers' evolving transportation needs. Comet Transport, an interregional truckload carrier, ships freight between the Company's regions and provides third party for-hire shipments. Logix, the Company's contract logistics subsidiary, enables the Company to offer its customers a single source for logistic management and dedicated carriage. STRATEGY Management's long-term operating and financial objectives include being the leading regional LTL carrier, recognized for its premier service, and enhancing its profitability. While significant accomplishments have been achieved since the Company was established, management believes the Company is well positioned 5 7 to further these objectives. As a result, management has developed a growth strategy based on evolving customer and industry trends. Management believes these trends include: - An increasing emphasis by shippers toward limiting the number of individual carriers they use to provide transportation services. The effect of this "core carrier" focus is to increase the customer's leverage with and, at the same time, dependence on certain specific suppliers of transportation services; - An increasing demand by shippers for enhanced quality and scope of transportation services. This trend relates to not only traditional qualitative service benchmarks such as on-time service and claims-free delivery of goods, but also to increasing the level of value-added information/technology associated with the provision of transportation services such as inventory management, billing and logistics; - Continued strong competition in the marketplace thereby elevating the importance of maintaining both a strong financial position and a unit cost advantage over other LTL providers; and - Further consolidation within the trucking industry as well as the possible convergence among suppliers of various modes of transportation services. Over the past several years, there have been numerous mergers, acquisitions and joint ventures within the trucking arena. Management believes long-term benefits will accrue to the larger operators that successfully integrate companies that possess diverse operational, cultural and financial characteristics. The trends highlighted above have been and continue to be evolving in the trucking industry. Several years ago management embarked on a strategy to capitalize on these trends. Management believes the Company is well positioned to further exploit these opportunities. The Company's strategy, as described below, illustrates its historical success and future plans in pursuing its long-term financial and strategic objectives. (i) Continue Geographic Expansion. After expanding operations to all 50 states in 1994, the Company began focusing on increasing the density of coverage of its regional trucking companies, especially at USF Holland, its largest operating subsidiary, with approximately 46% of the Company's consolidated revenue in 1995. During 1995, the Company's regional LTL companies increased the number of terminals by 20 over a dozen states across the country. During 1996, the Company increased its number of terminals by seven, and began providing direct service into Ontario and Quebec, Canada, as well as container service to Guam and the Caribbean. Early in 1996, the Company dramatically increased density in the Southeast by acquiring the general commodities business of Transus, Inc. and merged this operation into USF Dugan. In February 1996, the Company merged two of the most dominant carriers in their respective territories, United (covering the Northwest and Rocky Mountain states) and USF Reddaway (covering the West Coast). Management believes this consolidation has enhanced productivity and customer service capabilities of the newly consolidated USF Reddaway entity, which now has 55 terminals. (ii) Broaden Service Offerings. The Company also has expanded into new business activities through both internal growth and acquisitions. Three examples include logistics, interregional LTL carriage and distribution. Logix, the Company's newly renamed contract logistics business, provides complete supply chain management services, from supplying raw materials to delivering products to customers. Logix provides integrated logistics solutions throughout the logistics pipeline, including dedicated carriage, contract warehousing, inventory management, customer service, order fulfillment, and freight management. Through client server platforms, Logix's systems utilize communication links with satellites and computers to manage transportation, dispatch and operations. In the initial design of a customer's logistics needs, Logix uses decision support software to provide solutions in such areas as transportation optimization, routing, carrier selection, load planning and order optimization. In July 1996, Logix acquired the Interamerican Group, a third party logistics provider primarily in the contract warehousing business, whose customers include Proctor & Gamble, Kimberly-Clark, Microsoft, Xerox, Alberto-Culver, and Becton Dickinson. 6 8 In 1995, the Company broadened its service capabilities with the launch of Comet Transport, a premium, long-haul, expedited truckload carrier. Management believes Comet Transport's operations complement its regional LTL carriers by providing expedited service on interregional freight, improve its ability to meet demanding delivery schedules and make the Company more valuable to its customers, since the Company now offers integrated long-haul truckload and regional LTL service. Thirdly, the Company is positioning its USF Distribution Services business to meet new demands. The business collects and ships components to manufacturers and receives, sorts and moves merchandise from suppliers to retail stores. In 1996, USF Distribution opened a fully automated freight handling facility near Chicago which cost approximately $9 million. This facility integrates state-of-the-art bar-code scanning, automated sortation, full case order picking, and labeling systems to provide the customer speed, accuracy, and flexibility in getting product to the market. (iii) Develop Value-Added Technology. In an effort to continue to be a leader in service quality, the Company has made significant investments in value-added technology. Value-added is that which differentiates the Company's products by reducing costs to both the Company and its customers. The Company's strategy has been to invest in technology where a reasonable return can be achieved. The Company is continuing to upgrade its computer systems through implementation of a common operating platform and communications infrastructure across all operating companies. The Company now utilizes imaging systems that provide instant access to shipping and other customer related documents that can be retrieved and directly faxed in response to customer inquiries. Management believes its ability to integrate and leverage information technology will continue to be a significant factor in differentiating the Company from its competitors and that its ability to capture, consolidate and provide access to timely and accurate data will be as important to the Company's success as its ability to move freight. Management believes yields are enhanced through its investment in technology. (iv) Remain a Low-Cost Provider. As competition in the LTL industry remains fierce, management has executed an operating strategy of maintaining a low-cost structure to enhance profitability. In the first nine months of 1996, regional operating ratios ranged from a low of 89.4% (USF Bestway) to a high of 102.8% (USF Red Star). Excluding USF Red Star's operations, all regions produced positive operating margins. Management's success is best evidenced by the profitability of its largest operation, USF Holland. USF Holland generated 45% of total operating revenue in the first nine months of 1996 with an operating ratio of 91.4%. This success is due in part to USF Holland's strong brand recognition in the LTL marketplace and its reputation for premier service quality. The Company has been disappointed by USF Red Star's high operating ratio. To restore profitability, management undertook a restructuring of its USF Red Star subsidiary that included closing terminals, implementing strict cost controls and increasing yields per shipment. The Company anticipates that USF Red Star will report a small operating profit for the fourth quarter of 1996. (v) Seek Opportunistic Acquisitions. The fragmentation that has historically characterized the trucking industry positions it for further consolidation, and management has implemented a strategy to capitalize on this trend. The recent acquisitions of Transus, Inc. and Interamerican Group are examples of the implementation of this strategy. Given the complexity associated with integrating operations, fleets and cultures into the Company, the Company has been very selective when evaluating opportunities. Management seeks acquisitions that enhance the Company's brand, expand its service base, afford a favorable return on capital and complement existing operations. Moreover, as customer demand shifts, the Company may determine to expand beyond its core LTL truck haulage services to other modes of transportation. (vi) Maintain Financial Flexibility. Management's strategy is to maintain financial flexibility through a strong balance sheet and access to the public capital markets. This flexibility allows the Company to be opportunistic in making selective acquisitions, purchasing equipment, investing in facilities or expanding its business. 7 9 As of December 28, 1996, the Company had approximately 15,400 employees, of which 51% were members of unions. Approximately 88% of these union workers were employed by USF Holland and USF Red Star and belonged to the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America. Management believes relationships with its employees are good. The Company's executive offices are located at 9700 Higgins Road, Suite 570, Rosemont, Illinois 60018. The Company's telephone number is (847) 696-0200. RECENT DEVELOPMENTS On January 16, 1997, the Company released information regarding its performance for the 13 and 52 week periods ended December 28, 1996. Net income, before a restructuring charge, for the thirteen weeks ended December 28, 1996, was $10,297,000, equivalent to 45 cents per share. Net income for the quarter was $7,968,000, equivalent to 35 cents per share, after a restructuring charge at USF Red Star of 10 cents per share. This compares to net income of $6,696,000, equivalent to 30 cents per share, for the same period of the previous year. The restructuring charge at USF Red Star relates primarily to ongoing lease commitments for terminals no longer occupied and severance pay incurred in connection with the reduction of personnel. Revenue for the fourth quarter of the current year increased 18.6% to $341,975,000 from $288,378,000 for the fourth quarter of 1995. LTL revenue for the Company's regional trucking subsidiaries increased 16.4%, LTL shipments increased 14.9%, and LTL tonnage increased 17.7%. LTL revenue per shipment increased from $97.37 in the fourth quarter of last year to $98.61 for the current year's quarter, and weight per shipment increased from 1,091 lbs. to 1,117 lbs. Revenue for the Company's logistics businesses increased 36.5% from $17,241,000 in the 1995 quarter to $23,528,000 in the current year's quarter. Revenue for the 52 weeks ended December 28, 1996 increased 16.3% to $1,330,972,000 from $1,144,458,000 for the same period of last year. Net income, before the restructuring charge, for 1996 amounted to $33,807,000, equivalent to $1.51 per share, and net income was $31,478,000, equivalent to $1.41 per share, after the USF Red Star restructuring charge. This compares to net income of $33,338,000, equivalent to $1.51 per share, for the 52 weeks ended December 30, 1995. The operating ratios of the regional trucking group improved from 94.9% in the 1995 quarter to 93.6% in the current year's quarter. At USF Holland, LTL revenue increased 18.4% and the operating ratio was reduced from 92.6% in the 1995 quarter to 91.2% in the current year's quarter. USF Bestway experienced an increase of 6.7% in LTL revenue, and its operating ratio, which continued to improve, was 89.3% for the current year's quarter compared to 91.7% for the same quarter of last year. At USF Red Star, despite a 5.2% reduction in total revenue, the operating ratio improved from 104.3% in the 1995 quarter to 99.5% in the current year's quarter. The improvement at USF Red Star resulted from an increase in yield per shipment of 5.6% together with a significant reduction in operating costs resulting from the implementation of strict cost controls. Operating results at both USF Reddaway and USF Dugan were less than last year for both the fourth quarter and the entire year. Management believes the merger of USF Reddaway and United operations in 1996 has enhanced productivity and customer service capabilities in the Northwest United States. The integration of Transus into USF Dugan occurred in January 1996, and the Company now has complete coverage in the Southeastern United States. 8 10 SUMMARY CONSOLIDATED FINANCIAL AND OPERATING INFORMATION
FISCAL YEAR ENDED -------------------------------------------------------- NINE MONTHS ENDED 52 WEEKS 53 WEEKS 52 WEEKS 52 WEEKS 52 WEEKS ------------------- DEC. 28 JAN. 2 JAN. 1 DEC. 31 DEC. 30 SEPT. 30 SEPT. 28 1991 1993 1994 1994 1995 1995 1996 -------- -------- -------- ---------- ---------- -------- -------- (IN THOUSANDS OF DOLLARS, EXCEPT PER SHARE AND OPERATING STATISTICS) STATEMENT OF OPERATIONS DATA: Operating Revenue...... $649,775 $774,678 $898,920 $1,016,464 $1,144,458 $856,080 $988,997 Income from operations.......... 27,365 39,501 61,222 69,666 67,543 53,225 50,171 Interest expense, net................. (31) (1,632) (7,391) (8,417) (8,177) (5,948) (8,584) Other non-operating expense............. (210) (1,067) (1,683) (2,011) (878) (537) (516) -------- -------- -------- ---------- ---------- -------- -------- Net income from continuing operations before income taxes........ 27,124 36,802 52,148 59,238 58,488 46,740 41,071 Net income from continuing operations.......... 14,814 20,804 28,545 33,356 33,338 26,642 23,510 Net income............. 14,872 6,902 27,348 32,065 33,338 26,642 23,510 Net income per share from continuing operations.......... $0.59 $0.78 $1.25 $1.51 $1.51 $1.20 $1.05 Net income per share... $0.59 $0.26 $1.20 $1.45 $1.51 $1.20 $1.05 Average shares outstanding......... 25,200 26,882 22,853 22,142 22,123 22,144 22,312 OPERATING STATISTICS: Total tons (000)....... 4,487 5,184 5,977 6,210 6,835 5,052 5,761 Total shipments (000)............... 7,015 7,934 8,762 9,045 10,187 7,476 8,639 Revenue equipment...... 11,087 12,877 14,479 16,171 18,481 17,437 21,609 Employees.............. 8,811 9,721 11,089 12,184 13,187 13,387 15,393
SEPTEMBER 28, 1996 ----------------------- ACTUAL AS ADJUSTED -------- ----------- BALANCE SHEET DATA: Working Capital........................................................ $ 57,394 $ Total assets........................................................... 698,359 Long-term obligations, excluding current portion....................... 189,111 Stockholders' equity................................................... 262,362
9 11 RISK FACTORS An investment in the Company's Common Stock involves a degree of risk. In determining whether to make an investment in the Common Stock, potential investors should consider carefully all of the information set forth and incorporated into this Prospectus and, in particular, the following factors. GENERAL ECONOMIC AND BUSINESS FACTORS The Company's business is dependent upon a number of factors that may have a material adverse effect on its results of operations, many of which are beyond the Company's control. These factors include excess capacity in the trucking industry, work stoppages by those Company employees who are members of unions, significant increases or rapid fluctuations in fuel prices and interest rates, to the extent not offset by increases in freight rates or fuel surcharges. The Company's results of operations also are affected by global and national economic cycles and in customers' business cycles. In addition, the Company's results of operations are affected by seasonal factors such as post-holiday reductions in shipments and increased operating costs and higher fuel consumption in colder weather due to increased idle time. COMPETITION The trucking industry is extremely competitive and fragmented. The Company competes with many other LTL carriers of varying sizes and, to a lesser extent, with truckload carriers. Regional LTL carriers, including the Company's trucking subsidiaries, principally compete against other regional LTL carriers. To a lesser extent, they compete against interregional and long-haul LTL carriers, and overnight package companies. Significant barriers to entry into the regional LTL market exist as a result of the substantial capital requirements for terminals and revenue equipment and the need for a large, well-coordinated and skilled work force. In response to recent industry over-capacity, many LTL carriers have adopted discounting programs for shipping customers. Additionally, when new LTL competitors enter a geographic region, they often offer discounted prices to lure customers away from the Company's trucking subsidiaries. Such attempts to gain market share through rate reduction programs exert downward pressure on the industry's price structure and profit margins and have caused many LTL carriers to cease operations. ACQUISITIONS The growth of the Company has been, and may continue to be, dependent in part upon the acquisition of small-to-medium sized trucking and logistics companies throughout the United States. To date, the Company has been successful in identifying companies to acquire and in integrating such companies' operations into the Company's operations. The Company may face competition from transportation companies or other third parties for acquisition opportunities that become available. There can be no assurance that the Company will identify further acquisition candidates that will result in successful combinations in the future. Any future acquisitions by the Company may result in the incurrence of additional debt and amortization of expenses related to goodwill and other intangible assets, which could adversely affect the Company's profitability, or could involve the potentially dilutive issuance of additional equity securities. In addition, acquisitions involve numerous risks, including difficulties in the assimilation of the acquired company's operations, particularly in the period immediately following the consummation of such transactions, the diversion of the attention of the Company's management from other business concerns, the risk of entering into markets in which the Company has had no or only limited direct experience, and the potential loss of customers, key employees and drivers of the acquired company, all of which could have a material adverse effect on the Company's business and operating results. Although the Company does not have any commitments with respect to any acquisitions as of the date of this Prospectus, the Company continually evaluates acquisition opportunities as part of its growth strategy. REGULATION The Company is regulated by the United States Department of Transportation and by various state agencies. These regulatory authorities exercise broad powers, generally governing activities such as 10 12 authorization to engage in motor carrier operations, operations, safety, financial reporting, and certain mergers, consolidations and acquisitions. In addition, the Company's operations are subject to various environmental laws and regulations dealing with the transportation, storage, presence, use, disposal and handling of hazardous materials, discharge of stormwater and underground fuel storage tanks. If the Company suffers a spill or other accident involving hazardous substances or if the Company were found to be in violation of applicable laws or regulations, it could have a material adverse effect on the Company's business and operating results. DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS This Prospectus, including all documents incorporated herein by reference contains forward-looking statements. Additional written or oral forward-looking statements may be made by the Company from time to time in filings with the Securities and Exchange Commission or otherwise. The words "believe," "expect," "anticipate," and "project" and similar expressions identify forward-looking statements, which speak only as of the date the statement is made. Such forward-looking statements are within the meaning of that term in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements may include, but are not limited to, information regarding revenues, income or loss, capital expenditures, acquisitions, plans for future operations, financing needs or plans, the impact of inflation and plans relating to services of the Company, as well as assumptions relating to the foregoing. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Future events and actual results could differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. Statements in this Prospectus, including those set forth in "The Company" and "Risk Factors," and in "Business" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's Annual Report on Form 10-K for the year ended December 30, 1995, which is incorporated by reference herein, describe factors, among others, that could contribute to or cause such differences. 11 13 USE OF PROCEEDS The net proceeds to be received by the Company from the sale of the 2,700,000 shares of Common Stock offered by the Company are estimated to be approximately $ (approximately $ if the Underwriters' over-allotment option is exercised in full), after deducting underwriting discounts and estimated expenses of the offering. The Company intends to apply the net proceeds of this offering to reduce its outstanding indebtedness under its existing revolving credit facility. This credit facility, which had an outstanding principal balance of $78.0 million at December 28, 1996, bears a rate of interest based on LIBOR and expires on September 30, 2000. The weighted average rate of interest on the outstanding balance at December 28, 1996 was 5.80%. The Company may in the future use amounts available under the credit facility for general corporate and working capital purposes, including investments in capital equipment and to fund acquisitions. Pending the use of proceeds as described above, the net proceeds will be invested in short-term interest bearing securities. PRICE RANGE OF COMMON STOCK The Company's Common Stock is traded on the Nasdaq National Market under the trading symbol "USFC." The following table sets forth the quarterly high and low sales prices of the Company's Common Stock as reported by the Nasdaq National Market. The last sale price of the Common Stock on January 15, 1997 was $26.250 per share.
1995 HIGH LOW - - ---- ------- ------- First Quarter............................................................. $28.688 $20.250 Second Quarter............................................................ $25.000 $18.125 Third Quarter............................................................. $24.375 $17.750 Fourth Quarter............................................................ $21.125 $16.250
1996 HIGH LOW - - ---- ------- ------- First Quarter............................................................. $23.250 $18.250 Second Quarter............................................................ $24.250 $19.375 Third Quarter............................................................. $22.500 $16.750 Fourth Quarter............................................................ $28.250 $19.500
1997 HIGH LOW - - ---- ------- ------- First Quarter (through January 15, 1997).................................. $28.000 $26.250
As of December 28, 1996, there were approximately 4,000 beneficial owners of an aggregate of 22,594,890 outstanding shares of Common Stock. DIVIDEND POLICY Since July 2, 1992, the Company has paid a quarterly dividend of $0.093333 per share. Although it is the present intention of the Company to continue paying quarterly dividends, the timing, amount and form of future dividends will be determined by the board of directors and will depend, among other things, on the Company's results of operations, financial condition, cash requirements, certain legal requirements and other factors deemed relevant by the board of directors. 12 14 SELECTED CONSOLIDATED FINANCIAL DATA The following table sets forth the selected consolidated financial data for the Company. The selected "Statement of Operations Data" and "Balance Sheet Data" presented below for, and as of the end of, each of the years in the five-year period ended December 30, 1995 are derived from consolidated financial statements of the Company, which consolidated financial statements have been audited by KPMG Peat Marwick LLP, independent certified public accountants. The selected "Statement of Operations Data" and "Balance Sheet Data" presented below for, and as of, the nine months ended September 30, 1995 and September 28, 1996 are derived from the unaudited interim consolidated condensed financial statements of the Company which, in the opinion of management, have been prepared on the same basis as the audited consolidated financial statements and include all adjustments, consisting only of normal recurring adjustments, which management considers necessary for a fair presentation of the financial data shown. The results of operations for the nine months ended September 28, 1996 are not necessarily indicative of the results to be expected for the year ended December 28, 1996. This information should be read in conjunction with the consolidated financial statements and the notes thereto incorporated herein by reference and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in the Company's Annual Report on Form 10-K for the year ended December 30, 1995 and in the Company's Quarterly Report on Form 10-Q for the quarter ended September 28, 1996, both of which are incorporated by reference herein.
AS OF AND FOR FISCAL YEAR ENDED AS OF AND FOR -------------------------------------------------------- NINE MONTHS ENDED 52 WEEKS 53 WEEKS 52 WEEKS 52 WEEKS 52 WEEKS ------------------- DEC. 28 JAN. 2 JAN. 1 DEC. 31 DEC. 30 SEPT. 30 SEPT. 28 1991 1993 1994 1994 1995 1995 1996 -------- -------- -------- ---------- ---------- -------- -------- (IN THOUSANDS OF DOLLARS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED) STATEMENT OF OPERATIONS DATA: Operating Revenue.................... $649,775 $774,678 $898,920 $1,016,464 $1,144,458 $856,080 $988,997 Operating expenses: Salaries, wages and benefits....... 419,062 497,375 568,891 633,197 733,441 546,207 630,513 Purchased transportation........... 18,194 26,829 31,526 42,427 43,763 33,163 35,863 Operating expenses and supplies.... 83,621 97,729 109,525 125,936 144,702 107,655 133,592 Operating taxes and licenses....... 25,024 29,808 35,682 42,101 48,585 36,234 41,932 Insurance claims................... 11,745 13,369 16,039 18,012 17,556 13,749 17,010 Communication and utilities........ 9,387 10,024 10,489 12,247 13,337 9,937 11,475 Depreciation and equipment leases........................... 34,036 37,623 44,209 47,519 50,866 37,332 48,099 Building and office equipment rents............................ 9,021 10,690 11,361 13,485 13,283 9,962 11,554 Amortization of intangible assets........................... 6,487 5,391 3,038 3,020 2,583 2,001 1,821 Other operating expenses........... 5,833 6,339 6,938 8,854 8,799 6,615 6,967 -------- -------- -------- ---------- ---------- -------- -------- Total operating expenses............. 622,410 735,177 837,698 946,798 1,076,915 802,855 938,826 -------- -------- -------- ---------- ---------- -------- -------- Income from operations............... 27,365 39,501 61,222 69,666 67,543 53,225 50,171 -------- -------- -------- ---------- ---------- -------- -------- Non-operating income (expense): Interest expense................... (2,546) (2,024) (7,621) (9,081) (8,884) (6,491) (9,072) Interest income.................... 2,515 392 230 664 707 543 488 Other, net......................... (210) (1,067) (1,683) (2,011) (878) (537) (516) -------- -------- -------- ---------- ---------- -------- -------- Total non-operating expenses......... (241) (2,699) (9,074) (10,428) (9,055) (6,485) (9,100) -------- -------- -------- ---------- ---------- -------- -------- Net income from continuing operations before income taxes................ 27,124 36,802 52,148 59,238 58,488 46,740 41,071 Income tax expense................... (12,310) (15,998) (23,603) (25,882) (25,150) (20,098) (17,561) -------- -------- -------- ---------- ---------- -------- -------- Net income from continuing operations......................... 14,814 20,804 28,545 33,356 33,338 26,642 23,510 Discontinued operations, net......... 58 288 (1,197) -- -- -- -- Extraordinary item, net.............. -- -- -- (1,291) -- -- -- Cumulative effect of accounting change for income taxes............ -- (14,190) -- -- -- -- -- -------- -------- -------- ---------- ---------- -------- -------- Net income........................... $ 14,872 $ 6,902 $ 27,348 $ 32,065 $ 33,338 $ 26,642 $ 23,510 ======== ======== ======== ========== ========== ======== ======== Net income per share from continuing operations......................... $0.59 $0.78 $1.25 $1.51 $1.51 $1.20 $1.05 Net income per share................. $0.59 $0.26 $1.20 $1.45 $1.51 $1.20 $1.05 Average shares outstanding........... 25,200 26,882 22,853 22,142 22,123 22,144 22,312 BALANCE SHEET DATA: Working capital...................... $ 23,442 $ 23,680 $ 25,026 $ 26,168 $ 30,127 $ 30,215 $ 57,394 Total assets......................... 388,447 406,837 460,780 501,002 578,194 569,604 698,359 Long-term obligations, less current portion............................ 12,691 47,024 124,085 105,667 137,333 126,417 189,111 Stockholders' equity................. 205,780 229,779 180,509 208,094 233,152 227,935 262,362
13 15 MANAGEMENT The following table sets forth information with respect to the directors and executive officers of the Company:
NAME AGE POSITION - - ----------------------------------- ---- --------------------------------------------------- Morley Koffman..................... 66 Chairman of the Board of Directors John Campbell Carruth.............. 66 Chief Executive Officer, President and Director William N. Weaver, Jr. ............ 62 Director Robert P. Neuschel................. 78 Director Neil A. Springer................... 58 Director Robert V. Delaney.................. 61 Director John W. Puth....................... 68 Director Christopher L. Ellis............... 52 Senior Vice President, Finance and Chief Financial Officer
MORLEY KOFFMAN, has been a director of the Company since December 1991. He was elected Chairman of the Board in January of 1992. Mr. Koffman was a member of the law firm of Freeman & Company of Vancouver, British Columbia until March 31, 1993. Effective April 1, 1993, he became a member of Koffman Birnie & Kalef. Mr. Koffman is a director of Ainsworth Lumber Co. Ltd. and Westar Group Ltd. JOHN CAMPBELL CARRUTH, was appointed as the Company's Chief Executive Officer and President in June 1991 and has been a director of the Company since December 1991. Mr. Carruth was Chief Executive Officer and President of TNT Transport Group Inc., a subsidiary of TNT Limited, the Company's former parent corporation, from 1985 to 1992. WILLIAM N. WEAVER, JR., has been a director of the Company and the Company's Assistant Secretary since March 1992. Mr. Weaver is a member of the law firm of Sachnoff & Weaver, Ltd., an Illinois professional corporation, which is outside counsel to the Company. Mr. Weaver has practiced law in the State of Illinois since 1964 and serves as a director of System Software Associates, Inc. as well as several privately-held corporations. He holds an A.B. degree from Oberlin College and a J.D. from John Marshall Law School. ROBERT P. NEUSCHEL, has been a director of the Company since December 1991. Since 1978, Professor Neuschel has been Professor of Management at the J. L. Kellogg Graduate School of Management, where he is currently Professor of Corporate Governance and Associate Dean for Advisory Board Relations. From 1978 to December 1991, he was Managing Director of the Transportation Center at Northwestern University. NEIL A. SPRINGER, has been a director of the Company since December 1991. He has been Managing Director of Springer Souder & Associates since June 1994. He was Senior Vice President of Slayton International Inc. from September 1992 to May 1994. He was President-Central Region of Alexander Proudfoot Company from August 1991 to August 1992. Mr. Springer is a director of Idex Corporation and Dorsey Trailers, Inc. ROBERT V. DELANEY, has been a director of the Company since December 1991. Mr. Delaney has been an Executive Vice President of Cass Information Systems since January 1990. JOHN W. PUTH, has been a director of the Company since January 1992. Mr. Puth has been President of J. W. Puth Associates since December 1987, Chairman of American Lantern since December 1987, and Chairman of the Executive Committee of Sullivan Graphics since June 1992. Mr. Puth is a director of A.M. Castle & Co., Allied Products Co., Brockway Standard Holdings Corporation, L. B. Foster Inc., Lindberg Corporation, System Software Associates, Inc. and several private manufacturing companies. CHRISTOPHER L. ELLIS, has been Senior Vice President, Finance and Chief Financial Officer of the Company since June 1991. Mr. Ellis served as Vice President, Finance of TNT Transport Group, Inc., a subsidiary of TNT Limited, the Company's former parent corporation, from 1985 to 1992. 14 16 UNDERWRITING Subject to the terms and conditions set forth in a purchase agreement among the Company and the Underwriters (the "Purchase Agreement"), the Company has agreed to sell to each of the Underwriters named below (the "Underwriters"), and each of the Underwriters has severally agreed to purchase from the Company, the aggregate number of shares of Common Stock set forth opposite its name below:
NUMBER UNDERWRITERS OF SHARES - - ------------ --------- Merrill Lynch, Pierce, Fenner & Smith Incorporated........................................................ Schroder Wertheim & Co. Incorporated............................................. --------- Total....................................................................... 2,700,000 =========
In the Purchase Agreement, the Underwriters have severally agreed, subject to the terms and conditions set forth therein, to purchase all of the shares of Common Stock offered hereby (other than those subject to the over-allotment option described below) if any are purchased. The Company has been advised by the Underwriters that the Underwriters propose initially to offer the shares of Common Stock to the public at the public offering price set forth on the cover page of this Prospectus, and to certain dealers at such price less a concession not in excess of $ per share. The Underwriters may allow, and such dealers may reallow, a concession not in excess of $ per share to certain other dealers. After commencement of the offering, the price to the public and concessions to dealers may be changed. The Company has granted the Underwriters an option, exercisable within 30 days of the date of this Prospectus, to purchase up to 405,000 additional shares of Common Stock to cover over-allotments, if any, at the price to the public less the underwriting discount set forth on the cover page of this Prospectus. To the extent that the Underwriters exercise such option, in whole or in part, each Underwriter will have a firm commitment, subject to certain conditions, to purchase the same proportion of the option shares that the number of shares of Common Stock to be purchased by such Underwriter in the above table bears to the total number of shares of Common Stock offered by the Underwriters hereby. The Purchase Agreement provides that the Company will indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act, or contribute to payments the Underwriters may be required to make in respect thereof. The Company has agreed with the Underwriters that they will not offer, sell or contract to sell, or otherwise dispose of, directly or indirectly, or announce an offering of, any shares of Common Stock or any securities convertible into, or exchangeable for, shares of Common Stock or any securities convertible into, or exchangeable for, shares of Common Stock for a period of 90 days from the date of this Prospectus, without the prior written consent of Merrill Lynch & Co., except for grants of options and issuance and sales of Common Stock issued pursuant to any existing stock option or other benefit or incentive plans maintained for its officers, directors or employees or the issuance of Common Stock in connection with acquisitions. In connection with this offering, certain Underwriters may engage in passive market making transactions in the Common Stock on the Nasdaq National Market in accordance with Rule 10b-6A under the Exchange Act, during the two business day period before commencement of offers or sales of the Common Stock offered 15 17 hereby. Passive market making transactions must comply with certain volume and price limitations and be identified as such. In general, a passive market maker may display its bid at a price not in excess of the highest independent bid for the security and if all independent bids are lowered below the passive market maker's bid then such bid must be lowered when certain purchase limits are exceeded. LEGAL MATTERS The validity of the shares of Common Stock and certain other legal matters in connection with the offering will be passed upon for the Company by Sachnoff & Weaver, Ltd., Chicago, Illinois. Mr. William N. Weaver, Jr., a shareholder of Sachnoff & Weaver, Ltd. serves as a director of the Company. Certain legal matters relating to this offering will be passed upon for the Underwriters by Winston & Strawn, Chicago, Illinois. EXPERTS The consolidated financial statements of USFreightways Corporation as of December 30, 1995 and December 31, 1994 and for each of the years in the three-year period ended December 30, 1995 have been incorporated herein by reference in reliance upon the report of KPMG Peat Marwick LLP, independent certified public accountants, also incorporated by reference herein, and given upon the authority of said firm as experts in accounting and auditing. 16 18 BACK INSIDE COVER [PICTURES OF COMPANY FACILITIES] 19 ------------------------------------------------------ ------------------------------------------------------ NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN THOSE CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE UNDERWRITERS. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCE, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE AS OF WHICH INFORMATION IS GIVEN IN THIS PROSPECTUS. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. ------------------------ TABLE OF CONTENTS
PAGE ----- Available Information................. 3 Information Incorporated by Reference........................... 3 Prospectus Summary.................... 4 The Company........................... 4 Recent Developments................... 8 Summary Consolidated Financial and Operating Information............... 9 Risk Factors.......................... 10 Use of Proceeds....................... 12 Price Range of Common Stock........... 12 Dividend Policy....................... 12 Selected Consolidated Financial Data................................ 13 Management............................ 14 Underwriting.......................... 15 Legal Matters......................... 16 Experts............................... 16
------------------------------------------------------ ------------------------------------------------------ ------------------------------------------------------ ------------------------------------------------------ 2,700,000 SHARES USFREIGHTWAYS CORPORATION COMMON STOCK ($.01 PAR VALUE) --------------------------- PROSPECTUS --------------------------- [USFREIGHTWAYS LOGO] MERRILL LYNCH & CO. SCHRODER WERTHEIM & CO. , 1997 ------------------------------------------------------ ------------------------------------------------------ 20 PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION The following table sets forth the costs and expenses (other than underwriting discounts and commissions) payable by the Company in connection with the sale of the Common Stock being registered hereby. All of the amounts shown are estimated, except the SEC registration fee, the NASD filing fee and the Nasdaq National Market supplemental listing fee. SEC registration fee............................................. $ 28,074.00 NASD filing fee.................................................. 8,922.00 Nasdaq National Market supplemental listing fee.................. 17,500.00 *Printing expenses............................................... 77,500.00 *Legal fees and expenses......................................... 75,000.00 *Accounting fees and expenses.................................... 29,000.00 *Blue Sky fees and expenses...................................... 4,500 *Miscellaneous expenses.......................................... 5,000 ----------- Total....................................................... $245,496.00 ===========
- - ------------------------- * Estimated. ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS Section 145 of the General Corporation Law of the State of Delaware permits indemnification of directors, officers, employees and agents of corporations under certain conditions and subject to certain limitations. Section 13.1 of Article Thirteen of the Company's By-Laws provides for indemnification of any director, officer, employee or agent of the Company, or any person serving in the same capacity in any other enterprise at the request of the Company, under certain circumstances. Article Six of the Company's Amended and Restated Certificate of Incorporation eliminates the liability of directors of the Company under certain circumstances for breaches of fiduciary duty to the Company and its shareholders. Directors and officers of the Company are insured, at the expense of the Registrant, against certain liabilities which might arise out of their employment and which might not be subject to indemnification under the By-Laws. ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES The following documents are filed herewith or incorporated herein by reference.
EXHIBIT NUMBER DESCRIPTION OF EXHIBITS - - ------ ------------------------------------------------------------------------------------ * 1.1 Form of Purchase Agreement 4.2 Form of Indenture dated as of May 1, 1993 between USFreightways Corporation (formerly known as TNT Freightways Corporation) and Harris Trust and Savings Bank, as Trustee (incorporated by reference from USFreightways Corporation's Registration Statement on Form S-1, filed on April 16, 1993, Registration No. 33-61134. 5 Opinion of Sachnoff & Weaver, Ltd. 23.1 Consent of KPMG Peat Marwick LLP 23.2 Consent of Sachnoff & Weaver, Ltd. (included in Exhibit 5) * 24. Powers of Attorney
- - ------------------------- * Previously filed. II-1 21 ITEM 17. UNDERTAKINGS The Company hereby undertakes: (1) To file, during any period in which offers or sales are being made of the securities registered hereby, 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 this registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in this registration statement; and (iii) to include any material information with respect to the plan of distribution not previously disclosed in this registration statement or any material change to such information in this registration statement; provided, however, that the undertakings set forth in paragraphs (i) and (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 the Company pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in this 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. In addition, the Company hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Company's annual report pursuant to Section 13(a) or 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. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Company pursuant to the foregoing provisions, or otherwise, the Company has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Company of expenses incurred or paid by a director, officer or controlling person of the Company 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 Company will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. II-2 22 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, USFreightways Corporation 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. 1 to Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Rosemont, State of Illinois, on January 15, 1997. USFREIGHTWAYS CORPORATION By: /s/ JOHN CAMPBELL CARRUTH -------------------------------------- John Campbell Carruth, Chief Executive Officer, President and Director Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated on the dates indicated:
SIGNATURE TITLE DATE - - --------------------------------- ----------------------------------------- ----------------- * Chairman of the Board of Directors January 15, 1997 - - --------------------------------- Morley Koffman /s/ JOHN CAMPBELL CARRUTH Chief Executive Officer, President and January 15, 1997 - - --------------------------------- Director (Principal Executive Officer) John Campbell Carruth * Director January 15, 1997 - - --------------------------------- William N. Weaver, Jr. * Director January 15, 1997 - - --------------------------------- Robert P. Neuschel * Director January 15, 1997 - - --------------------------------- Neil A. Springer * Director January 15, 1997 - - --------------------------------- Robert V. Delaney * Director January 15, 1997 - - --------------------------------- John W. Puth /s/ CHRISTOPHER L. ELLIS Senior Vice President, Finance and Chief January 15, 1997 - - --------------------------------- Financial Officer (Principal Financial Christopher L. Ellis Officer) /s/ ROBERT S. OWEN Controller (Principal Accounting Officer) January 15, 1997 - - --------------------------------- Robert S. Owen
By: /s/ JOHN CAMPBELL CARRUTH - - ----------------------------- John Campbell Carruth, Attorney-in-fact II-3 23 EXHIBIT INDEX The following documents are filed herewith or incorporated herein by reference.
EXHIBIT NUMBER DESCRIPTION OF EXHIBITS - - ----------- ----------------------------------------------------------------------------------- * 1.1 Form of Purchase Agreement 4.2 Form of Indenture dated as of May 1, 1993 between USFreightways Corporation (formerly known as TNT Freightways Corporation) and Harris Trust and Savings Bank, as Trustee (incorporated by reference from USFreightways Corporation's Registration Statement on Form S-1, filed on April 16, 1993, Registration No. 33-61134. 5 Opinion of Sachnoff & Weaver, Ltd. 23.1 Consent of KPMG Peat Marwick LLP 23.2 Consent of Sachnoff & Weaver, Ltd. (included in Exhibit 5) * 24 Powers of Attorney
- - ------------------------- * Previously filed. EX-5 2 OPINION OF SACHNOFF & WEAVER LLP 1 Exhibit 5 [SACHNOFF & WEAVER, LTD. LETTERHEAD] January 15, 1997 USFreightways Corporation 9700 Higgins Road, Suite 570 Rosemont, Illinois 60018 Gentlemen: We have acted as counsel to USFreightways Corporation, a Delaware corporation (the "Company"), in connection with the Registration Statement on Form S-3, as amended (the "Registration Statement"), filed by the Company under the Securities Act of 1933, as amended, with the Securities and Exchange Commission (the "Commission"), relating to the sale of up to 3,105,000 shares (the "Shares") of the Company's Common Stock, par value $.01 per share. We have examined the Registration Statement and the form of the Purchase Agreement filed with the Commission as an exhibit to the Registration Statement (the "Purchase Agreement"). In addition, we have reviewed such other documents and have made such further investigations as we have deemed necessary to enable us to express the opinion hereinafter set forth. We hereby advise you that in our opinion the Shares have been duly authorized by the Company and, upon payment and delivery in accordance with the Purchase Agreement, will be validly issued, fully paid and nonassessable. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to us under the caption "Legal Matters" in the Registration Statement. In giving this consent, we do not hereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended or the rules and regulations of the Securities and Exchange Commission. Very truly yours, /s/ SACHNOFF & WEAVER, LTD. EX-23.1 3 CONSENT OF KPMG PEAT MARWICK LLP 1 EXHIBIT 23.1 The Board of Directors USFreightways Corporation: We consent to the use of our report dated January 17, 1996, except for note 1, which is as of January 26, 1996, relating to the consolidated financial statements of USFreightways Corporation as of December 30, 1995 and December 31, 1994, and for each of the years in the three-year period ended December 30, 1995 incorporated herein by reference and to the reference to our firm under the heading "Experts" and "Selected Consolidated Financial Data" in the prospectus. /s/ KPMG Peat Marwick LLP Chicago, Illinois January 15, 1997 -----END PRIVACY-ENHANCED MESSAGE-----