As filed with the Securities and Exchange Commission on September 24, 2009
Registration Statement No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
THE PRINCETON REVIEW, INC.
(Exact name of Registrant as specified in its charter)
| Delaware | 22-3727603 | |
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
111 Speen Street
Framingham, Massachusetts 01701
(508) 663-5050
(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)
Michael J. Perik
President and Chief Executive Officer
The Princeton Review, Inc.
111 Speen Street
Framingham, Massachusetts 01701
(508) 663-5050
(Name, address, including zip code, and telephone number, including area code, of agent for service)
With copies to:
| John M. Mutkoski, Esq. | ||
| Neal S. Winneg | Edward A. King, Esq. | |
| The Princeton Review, Inc. | Goodwin Procter LLP | |
| 111 Speen Street | Exchange Place | |
| Framingham, Massachusetts 01701 | Boston, Massachusetts 02109 | |
| (508) 663-5050 | (617) 570-1000 |
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 to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. x
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, 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 this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. ¨
If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box. ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” “non-accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
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Large accelerated filer ¨ |
Accelerated filer x | |||||
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Non-accelerated filer ¨ |
Smaller reporting company ¨ |
CALCULATION OF REGISTRATION FEE
|
Title of Each Class of Securities To Be Registered |
Amount to be Registered |
Proposed Maximum
Offering Price
|
Proposed Maximum
Aggregate
|
Amount of Registration Fee(1) |
||||
|
Common Stock, par value $0.01 per share |
(2) | (3) | (3) | — | ||||
|
Warrants |
(2) | (3) | (3) | — | ||||
|
Units(4) |
(2) | (3) | (3) | — | ||||
|
Preferred Stock |
(2) | (3) | (3) | — | ||||
|
Total |
(2) | (3) | $75,000,000 | $4,185 | ||||
| (1) | Calculated pursuant to Rule 457(o) under the Securities Act. |
| (2) | There is being registered hereunder such indeterminate number of shares of common stock, such indeterminate number of warrants to purchase common stock, such indeterminate number of units, and such indeterminate number of shares of preferred stock as shall have an aggregate initial offering price not to exceed $75,000,000. Pursuant to Rule 416 under the Securities Act, the shares of common stock being registered hereunder include such indeterminate number of shares of common stock as may be issuable with respect to the shares being registered hereunder as a result of stock splits, stock dividends or similar transactions. In addition, pursuant to Rule 457(i) under the Securities Act, the securities registered hereunder also include: |
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such indeterminate number of shares of common stock as may be issuable by the registrant upon conversion or exchange of any preferred stock, warrants or units issued under this registration statement; |
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such indeterminate number of shares of preferred stock as may be issuable by the registrant upon conversion or exchange of any preferred stock, warrants or units issued under this registration statement; and |
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such indeterminate number of warrants as may be issuable by the registrant upon conversion or exchange of any preferred stock or units issued by the registrant under this registration statement. |
In no event will the aggregate offering price of all securities issued by the registrant from time to time pursuant to this registration statement exceed $75,000,000. The securities registered by the registrant hereunder may be sold separately or with other securities registered hereunder.
| (3) | The proposed maximum aggregate offering price per class of security will be determined from time to time by the registrant in connection with the issuance by the registrant of the securities registered hereunder and is not specified as to each class of security pursuant to General Instruction II.D. of Form S-3 under the Securities Act. |
| (4) | Each unit will be issued under a unit agreement and will represent an interest in two or more securities, which may be or may not be separable from one another. |
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 or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities, and it is not soliciting an offer to buy these securities in any state where the
SUBJECT TO COMPLETION, DATED SEPTEMBER 24, 2009
Prospectus
$75,000,000
THE PRINCETON REVIEW, INC.
Common Stock
Warrants
Units
Preferred Stock
From time to time, we may offer and sell up to $75,000,000 of any combination of the securities described in this prospectus, either individually or in units. We will provide specific terms of these offerings and securities in one or more supplements to this prospectus. We may also authorize one or more free writing prospectuses to be provided to you in connection with these offerings. The prospectus supplement and any related free writing prospectus may also add, update or change information contained in this prospectus. You should read this prospectus, the applicable prospectus supplement and any related free writing prospectus carefully before buying any of the securities being offered.
This prospectus may not be used to consummate a sale of any securities unless accompanied by a prospectus supplement.
Our common stock is listed on The NASDAQ Global Market under the symbol “REVU.” On September 16, 2009, the last reported sale price of our common stock on The NASDAQ Global Market was $4.65. The applicable prospectus supplement will contain information, where applicable, as to any other listing, if any, on The NASDAQ Global Market or any securities market or other exchange of the securities covered by the applicable prospectus supplement.
Investing in our securities involves a high degree of risk. You should review carefully the risks and uncertainties described under the heading “ Risk Factors” contained on page 1 herein and in the applicable prospectus supplement and any related free writing prospectus, and under similar headings in the other documents that are incorporated by reference into this prospectus.
The securities may be sold directly by us to investors, through agents designated from time to time or to or through underwriters or dealers, on a continuous or delayed basis. For additional information on the methods of sale, you should refer to the section entitled “Plan of Distribution” in this prospectus. If any agents or underwriters are involved in the sale of any securities with respect to which this prospectus is being delivered, the names of such agents or underwriters and any applicable fees, commissions, discounts and over-allotment options will be set forth in a prospectus supplement. The price to the public of such securities and the net proceeds that we expect to receive from such sale will also be set forth in a prospectus supplement.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is , 2009.
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You should rely only on the information contained or incorporated by reference in this prospectus and any applicable prospectus supplements. We have not authorized anyone to provide you with information different from that contained in this prospectus. Offers to sell, and offers to buy, the securities are valid only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as to the date of this prospectus, regardless of the time of delivery of the prospectus or of any sale of the securities.
In this prospectus, references to the terms “Princeton Review,” “we,” “us,” “our” and similar terms, refer to The Princeton Review, Inc. and its wholly owned subsidiaries on a consolidated basis, unless we state or the context implies otherwise.
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This prospectus is part of a registration statement on Form S-3 that we filed with the Securities and Exchange Commission, or SEC, utilizing a “shelf” registration process. Under this shelf registration process, we may from time to time offer and sell common stock, preferred stock, warrants or units, or any combination of these securities, in one or more offerings up to a total dollar amount of $75,000,000. This prospectus provides you with a general description of the securities we may offer. Each time we offer any securities under this prospectus, we will provide a prospectus supplement that will contain more specific information about the terms of those securities. We may also authorize one or more free writing prospectuses to be provided to you that may contain material information relating to these offerings. This prospectus, together with applicable prospectus supplements and any related free writing prospectuses, includes all material information relating to these offerings. We may also add, update or change in the prospectus supplement (and in any related free writing prospectus that we may authorize to be provided to you) any of the information contained in this prospectus or in the documents that we have incorporated by reference into this prospectus. We urge you to read carefully this prospectus, any applicable prospectus supplement and any related free writing prospectus, together with the information incorporated herein by reference as described under the heading “Where You Can Find Additional Information,” before buying any of the securities being offered.
This prospectus may not be used to consummate a sale of securities unless it is accompanied by a prospectus supplement.
You should rely only on the information we have provided or incorporated by reference in this prospectus, any applicable prospectus supplement and any related free writing prospectus that we may authorize to be provided to you. We have not authorized anyone to provide you with different information. No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus, any applicable prospectus supplement or any related free writing prospectus that we may authorize to be provided to you. You must not rely on any unauthorized information or representation. This prospectus is an offer to sell only the securities offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. You should assume that the information in this prospectus, any applicable prospectus supplement or any related free writing prospectus is accurate only as of the date on the front of the document and that any information we have incorporated by reference is accurate only as of the date of the document incorporated by reference, regardless of the time of delivery of this prospectus, any applicable prospectus supplement or any related free writing prospectus, or any sale of a security.
This prospectus contains summaries of certain provisions contained in some of the documents described herein, but reference is made to the actual documents for complete information. All of the summaries are qualified in their entirety by the actual documents. Copies of some of the documents referred to herein have been filed, will be filed or will be incorporated by reference as exhibits to the registration statement of which this prospectus is a part, and you may obtain copies of those
Investing in our securities involves significant risks. Please see the risk factors under the heading “Risk Factors” in our most recent Annual Report on Form 10-K on file with the SEC, as revised or supplemented by our Quarterly Reports on Form 10-Q and 8-Ks filed with the SEC since the filing of our most recent Annual Report on Form 10-K, each of which are on file with the SEC and are incorporated by reference in this prospectus. Before making an investment decision, you should carefully consider these risks as well as other information we include or incorporate by reference in this prospectus and any prospectus supplement. The risks and uncertainties we have described are not the only ones facing our company. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also affect our business operations. The occurrence of any of these risks might cause you to lose all or part of your investment in the offered securities. The discussion of risks includes or refers to forward-looking statements; you should read the explanation of the qualifications and limitations on such forward-looking statements discussed elsewhere in this prospectus.
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About The Princeton Review, Inc.
The Princeton Review provides integrated classroom-based, print and online products and services that address the needs of students, parents, educators and educational institutions. We offer one of the leading SAT preparation courses and are among the leading providers of test preparation courses for most major post-secondary and graduate admissions tests. The Company and its international franchisees provide test preparation courses and tutoring services for the SAT, GMAT, MCAT, LSAT, GRE and other standardized admissions tests to students throughout the United States and abroad.
We currently operate through our Test Preparation Services and Supplemental Educational Services divisions. Our Test Preparation Services division provides classroom-based and Princeton Review online test preparation courses and tutoring services. This division also receives royalties from its independent international franchisees, which provide classroom-based courses under the Princeton Review brand. Our Supplemental Educational Services division provides state-aligned research-based academic tutoring instruction to students in schools in need of improvement in school districts throughout the country which receive funding under the No Child Left Behind Act of 2001.
We author more than 169 print and software titles on test preparation, academic admissions and related topics under the Princeton Review brand. Books are sold primarily through Random House, Inc., from which we collect fees for royalties and editing and marketing arrangements.
We were incorporated in Delaware in March 2000. Our executive offices are located at 111 Speen Street, Framingham, Massachusetts 01701 and our telephone number is (508) 663-5050. Our Internet web address is www.PrincetonReview.com. The information on our web site is not incorporated by reference into this prospectus and should not be considered to be part of this prospectus.
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Cautionary Note Regarding Forward-Looking Statements
This prospectus, including the information incorporated by reference into this prospectus, contains, and any prospectus supplement may contain, statements that are forward-looking statements within the meaning of the federal securities laws. We caution you that any forward-looking statements presented in this prospectus, or which management may make orally or in writing from time to time, are based on management’s beliefs and assumptions made by, and information currently available to, management. When we use the words “believe,” “expect,” “anticipate,” “plan,” “intend,” “estimate,” “project,” “may,” “will,” “should,” “continue,” “assume” and other similar expressions, they are generally forward-looking statements. These statements include, among other things, statements regarding our intent, belief or expectations with respect to:
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our strategic plans; |
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our business outlook; and |
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our future business and financial performance. |
These statements are not guarantees of future performance and are subject to certain risks, uncertainties, and other factors, some of which are beyond our control, are difficult to predict, and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. The risks and uncertainties to which these statements are subject include, but are not limited to, those risks and uncertainties described in “Risk Factors” and elsewhere in this prospectus, the accompanying prospectus supplement, and the documents incorporated by reference herein and therein, and include the following:
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general economic and business conditions, including unforeseen economic weakness in our markets; |
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our history of operating losses; |
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demand for our products and services; |
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our ability to compete effectively and adjust to rapidly changing market dynamics; |
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our ability to comply with state and federal regulations; |
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our ability to continually enhance our products and services and adapt them to changes in technology; |
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negative developments in school funding or education laws; |
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the effect of seasonal fluctuations on our operating results; |
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the timing of revenue recognition from significant contracts with schools and school districts; |
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market acceptance of our products and services; |
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continued federal and state focus on assessment and remediation in K-12 education; |
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our ability to attract and retain highly qualified personnel; |
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our ability to protect our intellectual property rights; |
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the availability of sufficient funds for our corporate needs; |
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difficulties in retaining significant customers; and |
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various other factors beyond our control. |
We caution you to carefully consider these risks and not to place undue reliance on our forward-looking statements. Except as required by law, we assume no responsibility for updating any forward-looking statements.
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We currently intend to use the net proceeds from the sale of any securities under this prospectus for general corporate purposes, which may include the following:
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working capital; |
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capital expenditures; |
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the repayment and refinancing of debt; |
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the acquisition of other companies or businesses; and |
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other purposes as mentioned in any prospectus supplement. |
We have not yet determined the amount of net proceeds to be used specifically for any of the foregoing purposes. Accordingly, our management will have significant discretion and flexibility in applying the net proceeds from the sale of these securities. Pending such uses, we may temporarily invest the net proceeds. The precise amounts and timing of the application of proceeds will depend upon our funding requirements and the availability of other funds.
Based upon our financial needs, we may engage in additional financings of a character and amount that we determine as the need arises.
The descriptions of the securities contained in this prospectus, together with the applicable prospectus supplements, summarize the material terms and provisions of the various types of securities that we may offer. We will describe in the applicable prospectus supplement relating to any securities the particular terms of the securities offered by that prospectus supplement. If we indicate in the applicable prospectus supplement, the terms of the securities may differ from the terms we have summarized below. We will also include in the prospectus supplement information, where applicable, about material U.S. federal income tax considerations relating to the securities, and the securities exchange, if any, on which the securities will be listed.
We may sell from time to time, in one or more offerings:
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common stock; |
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warrants; |
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units; |
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preferred stock; and |
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any combination of the foregoing securities. |
In this prospectus, we will refer to the common stock, warrants, units and preferred stock collectively as “securities.” The total dollar amount of all securities that we may issue under this prospectus will not exceed $75,000,000.
This prospectus may not be used to consummate a sale of securities unless it is accompanied by a prospectus supplement.
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Description of Preferred Stock
The following description of our preferred stock, together with the additional information we include in any applicable prospectus supplements, summarizes the material terms and provisions of the preferred stock that we may offer under this prospectus. The following description does not purport to be complete and is subject to, and qualified in its entirety by, our Amended and Restated Certificate of Incorporation and our Amended and Restated By-Laws, which are exhibits to the registration statement of which this prospectus forms a part, and by applicable law. We refer to our Amended and Restated Certificate of Incorporation as our certificate of incorporation, and we refer to our Amended and Restated By-Laws as our by-laws. You can access complete information by referring to our certificate of incorporation and bylaws and to any applicable amendment to the certificate of incorporation designating terms of a series of preferred stock, including, without limitation, certificates of designation.
General
Under our certificate of incorporation, we have authority to issue 5,000,000 shares of preferred stock, par value $.01 per share. As of August 3, 2009, there were 60,000 shares of our authorized preferred stock designated as series C convertible preferred stock, or Series C Preferred Stock, 60,000 of which were issued and outstanding. The rights, preferences, privileges and restrictions of shares of Series C Preferred Stock have been fixed in a certificate of designation, which is an exhibit to the registration statement of which this prospectus forms a part. Set forth below are the material terms of the Series C Preferred Stock:
Seniority. The Series C Preferred Stock ranks senior to the common stock and senior to all other existing or future classes or series of preferred stock or other equity securities.
Dividends. Until July 23, 2011, cumulative dividends accrue on the Series C Preferred Stock at an annual rate of 6.0% of the stated liquidation preference amount, as defined below. Holders of the Series C Preferred Stock are entitled to participate on an as converted basis in the payment of any dividends on the common stock, other than a stock dividend payable solely in the form of additional shares of common stock.
Liquidation Preference. Upon any voluntary or involuntary liquidation, dissolution or winding-up, holders of the Series C Preferred Stock have the right to receive, in preference to all other classes of our stock junior in rank to the Series C Preferred Stock, an amount per share equal to the greater of (i) $1,000 per share plus all accrued but unpaid dividends, referred to as the Series C Liquidation Amount, or (ii) the amount per share that a holder would have received if, immediately prior to the liquidation, that holder’s share had been converted to common stock. After payment of the liquidation preference described above, holders of the Series C Preferred Stock are not entitled to any further participation in any distribution of our assets.
Conversion. Each share of Series C Preferred Stock is convertible into that number of shares of common stock equal to the quotient determined by dividing the Series C Liquidation Amount by the conversion price. The initial conversion price of the Series C Preferred Stock is $6.00 per share. The conversion price is subject to proportional adjustment for any stock splits, stock dividends, subdivisions or combinations of our common stock or Series C Preferred Stock. The conversion price is also subject to adjustment for any reclassification or capital reorganization of the Series C Preferred Stock or any reorganization, recapitalization, reclassification, consolidation or merger in which the common stock is converted into or exchanged for securities, cash or other property. The holder of a share of Series C Preferred Stock may elect to convert that holder’s share at any time; provided, however, that unless and until we obtain the requisite approval of our stockholders to comply with the applicable rules of The NASDAQ Global Market, a holder of shares of Series C Preferred Stock may not receive, upon any such conversion, a number of shares of common stock that would cause such holder to own, in the aggregate, in excess of 19.9% of our outstanding shares of common stock.
Voting. The Series C Preferred Stock has the right, to the exclusion of all other classes or series of the Company’s capital stock, to elect two (2) individuals to serve on our board of directors. Except for these individuals, which we refer to as the Series C Directors, the Series C Preferred is not entitled to vote for the election of directors. However, the holders of Series C Preferred Stock are entitled to vote on all other matters on which the holders of common stock are entitled to vote, voting together with the holders of common stock as a single class. Each share of Series C Preferred Stock is entitled to that number of votes as is equal to the number of shares of common stock into which such share may be converted. In addition, among other things, we are not permitted, without the affirmative vote or written consent of the holders of at least a majority of the outstanding Series C Preferred Stock (75% of the outstanding Series C Preferred Stock with respect to item (9) below), directly or indirectly, to take any of the following actions or agree to take any of the following actions:
| (1) | create or issue any equity securities or securities convertible into equity securities with equal or superior rights, preferences or privileges to those of the Series C Preferred Stock; |
| (2) | alter, amend or waive our certificate of incorporation or by-laws in a manner that affects the rights, preferences or powers of the Series C Preferred Stock or otherwise adversely affect the holders of the Series C Preferred Stock; |
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| (3) | alter, amend or waive any provisions of our by-laws relating to the nomination or election of directors to our board of directors; |
| (4) | increase or decrease the number of authorized shares of Series C Preferred Stock; |
| (5) | declare or pay any dividends on, or make any redemption of any capital stock, except for certain repurchases and redemptions from employees; |
| (6) | issue any debt securities which are convertible into capital stock; |
| (7) | except for certain transactions specified in the certificate of designation, engage in any change of control event, merge with or into or consolidate with any other company, or sell, transfer or dispose more than 25% of the fair market value of our consolidated assets, in each case prior to July 23, 2014; |
| (8) | acquire or make certain investments specified in the certificate of designation; |
| (9) | enter into any transaction with senior management or an affiliate except for arms’ length employment agreements; |
| (10) | enter into certain debt or lease transactions specified in the certificate of designation; |
| (11) | change the authorized number of directors on our board of directors; and |
| (12) | hire, terminate, replace or reassign our chief executive officer. |
Redemption. On or after July 23, 2015, the holders of at least 10% of the outstanding shares of Series C Preferred Stock may require us to redeem all or any portion of the outstanding shares of Series C Preferred Stock. The redemption price is equal to the Series C Liquidation Amount. Each holder of Series C Preferred Stock also has the right to require the Company to redeem all or a portion of the holder’s Series C Preferred Stock for cash in connection with a change of control at a redemption price equal to the greater of the fair market value per share valued as of the date of such change of control and the Series C Liquidation Amount (assuming, in the event of a change of control prior to July 23, 2011, accrued and unpaid dividends will include all dividends that would have accrued on the Series C Preferred Stock through and including July 23, 2011). In addition, subject to the conversion rights of the Series C Preferred Stock, if at any time on or after July 23, 2011, the closing bid price of our common stock for 30 consecutive trading days is at least $3,000 when multiplied by the number of shares of common stock into which one shares of Series C Preferred Stock is then convertible, we have the right to redeem all (but not less than all) of the outstanding shares of Series C Preferred Stock within prescribed time periods at a redemption price per share equal to the Series C Liquidation Amount.
We do not have any other shares of preferred stock outstanding as of the date of this prospectus. Shares of preferred stock may be issued from time to time, in one or more series, as authorized by our board of directors. Subject to the rights of any existing series of preferred stock, including the Series C Preferred Stock, our board of directors has the authority to:
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fix the number of shares of any series of preferred stock and to determine the designation of any such series; |
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determine and alter the powers, rights, preferences and privileges and the qualifications, limitations and restrictions granted to or imposed upon any wholly unissued series of preferred stock; and |
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increase or decrease, but not below the number of shares of such series then outstanding, the number of shares of any series subsequent to the issue of shares of that series (within the limitations or restrictions stated in any resolution or resolutions of the board of directors originally fixing the number of shares constituting any series). |
The issuance of preferred stock, while providing desirable flexibility in connection with possible acquisitions and other corporate purposes, could have the effect of delaying, deferring or preventing a change in control without further action by our stockholders and may adversely affect the market price of, and the voting and other rights of the holders of, our common stock.
Terms
If we decide to issue any preferred stock pursuant to this prospectus, we will describe in a prospectus supplement the terms of the preferred stock, including, if applicable, the following:
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the maximum number of shares; |
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the designation, relative ranking and stated value of the shares; |
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the annual dividend rate, if any, whether the dividend rate is fixed or variable, the date dividends will accrue, the dividend payment dates, whether dividends will be cumulative and the method of calculation for dividends; |
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whether the payment of any dividends on preferred stock is subject to any restrictions against the payment of any dividends contained in any then effective debt or other instrument; |
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the price and the terms and conditions for redemption, if any, including redemption at our option or at the option of the holders, including the time period for redemption, and any accumulated dividends or premiums; |
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the liquidation preference, if any, and any accumulated dividends upon liquidation, dissolution or winding up of our affairs; |
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any sinking fund or similar provision, and, if so, the terms and provisions relating to the purpose and operation of the fund; |
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the terms and conditions, if any, for conversion or exchange of shares of any other class or classes of our capital stock or any series of any other class or classes, or of any other series of the same class, or any other securities or assets, including the price or the rate of conversion or exchange and the method, if any, of adjustment; |
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any limitations on issuances of any class or series of preferred stock ranking senior to or on a parity with the series of preferred stock being issued as to dividend rights and rights if we liquidate, dissolve or wind up our affairs; |
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if applicable, a discussion of material U.S. federal income tax considerations; |
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any listing of the preferred stock on any securities exchange or market; |
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the voting rights if any, of the preferred stock; and |
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any or all other preferences and relative, participating, optional or other special rights, privileges or qualifications, limitations, terms or restrictions of the preferred stock. |
When we issue shares of preferred stock under this prospectus, the shares will be fully paid and nonassessable and will not have, or be subject to, any preemptive or similar rights.
Delaware law provides that the holders of preferred stock have the right to vote separately as a class on any proposal involving fundamental changes in the rights of holders of that preferred stock. This right is in addition to any voting rights that may be provided for in a certificate of designation.
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The following description of our common stock, together with the additional information we include in any applicable prospectus supplements, summarizes the material terms and provisions of the common stock that we may offer under this prospectus. The following description does not purport to be complete and is subject to, and qualified in its entirety by, our certificate of incorporation and our by-laws. The terms of our common stock may also be affected by Delaware law.
General
Under our certificate of incorporation, we have authority to issue 100,000,000 shares of common stock, par value $0.01 per share. As of August 3, 2009, there were 33,719,808 shares of our common stock issued and outstanding. In addition, as of August 3, 2009, 11,256,317 shares of our common stock were reserved for issuance upon conversion of our outstanding series C convertible preferred stock, or Series C Preferred Stock, which is described above under “Description of Preferred Stock—General.” For greater detail about our common stock, please refer to our certificate of incorporation and by-laws.
Dividends
Subject to the prior rights of any series of preferred stock which may from time to time be outstanding, the holders of our common stock are entitled to receive such dividends, if any, as may be declared from time to time by our board of directors out of legally available funds. In the event we are liquidated, dissolved or our affairs are wound up, after we pay or make adequate provision for all of our known debts and liabilities, each holder of common stock will receive dividends pro rata out of assets that we can legally use to pay distributions, subject to any rights that are granted to the holders of any class or series of preferred stock.
Voting Rights
Holders of common stock will have the exclusive power to vote on all matters presented to our stockholders, including the election of directors, except as otherwise provided by Delaware law or as provided with respect to any other class or series of stock, such as our Series C Preferred Stock. Holders of common stock are entitled to one vote per share. There is no cumulative voting in the election of our directors, which means that, subject to any rights to elect directors that are granted to the holders of any class or series of preferred stock, a plurality of the votes cast at a meeting of stockholders at which a quorum is present is sufficient to elect a director.
Other Rights
Subject to the preferential rights of any other class or series of stock, all shares of common stock have equal dividend, distribution, liquidation and other rights, and have no preference, appraisal or exchange rights, except for any appraisal rights provided by Delaware law. Furthermore, holders of common stock have no conversion, sinking fund or redemption rights, or preemptive rights to subscribe for any of our securities. If applicable, material U.S. federal income tax considerations applicable to our common stock will be described in the applicable prospectus supplement.
Certain Anti-Takeover Provisions of Delaware Law and our Certificate of Incorporation and Bylaws
Delaware General Corporation Law. We are subject to the provisions of Section 203 of the Delaware General Corporation Law, which generally has an anti-takeover effect for transactions not approved in advance by our board of directors, including discouraging attempts that might result in a premium over the market price for the shares of our common stock held by stockholders. In general, Section 203 prohibits a publicly held Delaware corporation from engaging in a “business combination” with an “interested stockholder” for a three-year period following the time that such stockholder becomes an interested stockholder, unless the business combination is approved in a prescribed manner. A “business combination” includes, among other things, a merger, asset or stock sale or other transaction resulting in a financial benefit to the interested stockholder. An “interested stockholder” is a person who, together with affiliates and associates, owns, or did own within three years prior to the determination of interested stockholder status, 15% or more of the corporation’s voting stock. Under Section 203, a business combination between a corporation and an interested stockholder is prohibited unless it satisfies one of the following conditions:
| • |
before the stockholder became interested, the board of directors approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder; or |
| • |
upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding, shares owned by: |
8
| • |
persons who are directors and also officers, and |
| • |
employee stock plans, in some instances; or |
| • |
at or after the time the stockholder became interested, the business combination was approved by the board of directors of the corporation and authorized at an annual or special meeting of the stockholders by the affirmative vote of at least two-thirds of the outstanding voting stock which is not owned by the interested stockholder. |
Staggered Board of Directors. Except for the two Series C Directors who are elected exclusively by the holders of our Series C Preferred Stock as described above under “Description of Preferred Stock—General,” our certificate of incorporation and by-laws provide that our board of directors be classified into three classes of directors of approximately equal size. As a result, in most circumstances, a person can gain control of our board only by successfully engaging in a proxy contest at two or more annual meetings.
Stockholder Action; Special Meeting of Stockholders. Our certificate of incorporation provides that our stockholders may not take any action by written consent, but only may take action at duly called annual or special meetings of stockholders. Our by-laws further provide that special meetings of our stockholders may be only called by our board of directors, the chairman of the board or our chief executive officer.
Advance Notice Requirements for Stockholder Proposals and Director Nominations. Our by-laws provide that stockholders seeking to bring business before our annual meeting of stockholders, or to nominate candidates for election as directors at our annual meeting of stockholders, must provide timely notice of their intent in writing. To be timely, a stockholder’s notice needs to be delivered to our principal executive offices within specified time periods. Our by-laws also specify certain requirements as to the form and content of a stockholders’ meeting. These provisions may preclude our stockholders from bringing matters before our annual meeting of stockholders or from making nominations for directors at our annual meeting of stockholders.
Authorized But Unissued Shares. Subject to the rights of any existing preferred stock, including our Series C Preferred Stock, our authorized but unissued shares of common stock and preferred stock are available for future issuances without stockholder approval and could be utilized for a variety of corporate purposes, including future offerings to raise additional capital, corporate acquisitions, employee benefit plans and stockholder rights plans. The existence of authorized but unissued and unreserved common stock and preferred stock could render more difficult or discourage an attempt to obtain control of us by means of a proxy contest, tender offer, merger or otherwise.
Removal of Directors . Except for the Series C Directors elected by the holders of our Series C Preferred Stock, our certificate of incorporation provides that a director on our board of directors may be removed from office only for cause and only by the affirmative vote of the holders of a majority or more of the shares then entitled to vote at an election of our directors. The Series C Directors may be removed from office with or without cause by the affirmative vote of the holders of
Transfer Agent
The transfer agent and registrar for our common stock is Continental Stock Transfer & Trust Company. Its address is 2 Broadway 19th Floor New York, NY 10004.
Listing
Our common stock is listed on The NASDAQ Global Market under the symbol “REVU.”
9
The following description, together with the additional information we may include in any applicable prospectus supplements, summarizes the material terms and provisions of the warrants that we may offer under this prospectus and the related warrant agreements and warrant certificates. While the terms summarized below will apply generally to any warrants that we may offer, we will describe the particular terms of any series of warrants in more detail in the applicable prospectus supplement. If we indicate in the prospectus supplement, the terms of any warrants offered under that prospectus supplement may differ from the terms described below.
We will file as exhibits to the registration statement of which this prospectus is a part, or will incorporate by reference from reports that we file with the SEC, the form of warrant agreement, including a form of warrant certificate, that describes the terms of the particular warrants we are offering before the issuance of the related warrants. The following summaries of material provisions of the warrants and the warrant agreements are subject to, and qualified in their entirety by reference to, all the provisions of the warrant agreement and warrant certificate applicable to the warrants that we may offer under this prospectus. We urge you to read the applicable prospectus supplements related to the warrants that we may offer under this prospectus, as well as any related free writing prospectuses, and the complete warrant agreements and warrant certificates that contain the terms of the warrants.
General
We may issue warrants for the purchase of common stock or preferred stock in one or more series. We may issue warrants independently or together with common stock and preferred stock, and the warrants may be attached to or separate from these securities.
We will evidence each series of warrants by warrant certificates that we will issue under a separate agreement. We may enter into a warrant agreement with a warrant agent. We will indicate the name and address and other information regarding the warrant agent in the applicable prospectus supplement relating to a particular series of warrants.
If we decide to issue warrants pursuant to this prospectus, we will specify in a prospectus supplement the terms of the series of warrants, including, if applicable, the following:
| • |
the offering price and aggregate number of warrants offered; |
| • |
the currency for which the warrants may be purchased; |
| • |
the designation and terms of the securities with which the warrants are issued and the number of warrants issued with each such security or each principal amount of such security; |
| • |
the date on and after which the warrants and the related securities will be separately transferable; |
| • |
in the case of warrants to purchase common stock, the number of shares of common stock purchasable upon the exercise of one warrant and the price at which these shares may be purchased upon such exercise; |
| • |
the effect of any merger, consolidation, sale or other disposition of our business on the warrant agreement and the warrants; |
| • |
the terms of any rights to redeem or call the warrants; |
| • |
any provisions for changes to or adjustments in the exercise price or number of securities issuable upon exercise of the warrants; |
| • |
the dates on which the right to exercise the warrants will commence and expire; |
| • |
the manner in which the warrant agreement and warrants may be modified; |
| • |
a discussion of any material U.S. federal income tax considerations of holding or exercising the warrants; |
| • |
the terms of the securities issuable upon exercise of the warrants; and |
| • |
any other specific terms, preferences, rights or limitations of or restrictions on the warrants. |
Before exercising their warrants, holders of warrants will not have any of the rights of holders of the securities purchasable upon such exercise, including, in the case of warrants to purchase common stock or preferred stock, the right to receive dividends, if any, or payments upon our liquidation, dissolution or winding up or to exercise voting rights, if any.
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Exercise of Warrants
Each warrant will entitle the holder to purchase shares of our common stock or preferred stock at the exercise price that we describe in the applicable prospectus supplement. Holders of the warrants may exercise the warrants at any time up to the specified time on the expiration date that we set forth in the applicable prospectus supplement. After the close of business on the expiration date, unexercised warrants will become void.
Holders of the warrants may exercise the warrants by delivering the warrant certificate representing the warrants to be exercised together with specified information, and paying the required amount to the warrant agent in immediately available funds, as provided in the applicable prospectus supplement. We will set forth on the reverse side of the warrant certificate and in the applicable prospectus supplement the information that the holder of the warrant will be required to deliver to the warrant agent.
Upon receipt of the required payment and the warrant certificate properly completed and duly executed at the corporate trust office of the warrant agent or any other office indicated in the applicable prospectus supplement, we will issue and deliver the common stock purchasable upon such exercise. If fewer than all of the warrants represented by the warrant certificate are exercised, then we will issue a new warrant certificate for the remaining amount of warrants. If we so indicate in the applicable prospectus supplement, holders of the warrants may surrender shares of common stock as all or part of the exercise price for warrants.
Enforceability of Rights by Holders of Warrants
Each warrant agent will act solely as our agent under the applicable warrant agreement and will not assume any obligation or relationship of agency or trust with any holder of any warrant. A single bank or trust company may act as warrant agent for more than one issue of warrants. A warrant agent will have no duty or responsibility in case of any default by us under the applicable warrant agreement or warrant, including any duty or responsibility to initiate any proceedings at law or otherwise, or to make any demand upon us. Any holder of a warrant may, without the consent of the related warrant agent or the holder of any other warrant, enforce by appropriate legal action its right to exercise, and receive the securities purchasable upon exercise of, its warrants.
11
The following description, together with the additional information that we include in any applicable prospectus supplements and in any related free writing prospectuses, summarizes the material terms and provisions of the units that we may offer under this prospectus. While the terms we have summarized below will apply generally to any units that we may offer under this prospectus, we will describe the particular terms of any series of units in more detail in the applicable prospectus supplement. The terms of any units offered under a prospectus supplement may differ from the terms described below.
We will file as exhibits to the registration statement of which this prospectus is a part, or will incorporate by reference from reports that we file with the SEC, the form of unit agreement that describes the terms of the series of units we are offering, and any supplemental agreements, before the issuance of the related series of units. The following summaries of material terms and provisions of the units are subject to, and qualified in their entirety by reference to, all the provisions of the unit agreement and any supplemental agreements applicable to a particular series of units. We urge you to read the applicable prospectus supplements related to the particular series of units that we may offer under this prospectus, as well as any related free writing prospectuses and the complete unit agreement and any supplemental agreements that contain the terms of the units.
General
We may issue units comprised of shares of common stock, preferred stock and warrants in any combination. Each unit will be issued so that the holder of the unit is also the holder of each security included in the unit. Thus, the holder of a unit will have the rights and obligations of a holder of each included security. The unit agreement under which a unit is issued may provide that the securities included in the unit may not be held or transferred separately, at any time or at any time before a specified date.
We will describe in the applicable prospectus supplement the terms of the series of units, including:
| • |
the designation and terms of the units, including whether and under what circumstances the securities comprising the units may be held or transferred separately; |
| • |
any provisions of the governing unit agreement that differ from those described below; and |
| • |
any provisions for the issuance, payment, settlement, transfer or exchange of the units or of the securities comprising the units. |
The provisions described in this section, as well as those described under “Description of Capital Stock” and “Description of Warrants,” will apply to each unit and to the common stock, preferred stock and warrant included in each unit, respectively.
Issuance in Series
We may issue units in such amounts and in such numerous distinct series as we determine.
Enforceability of Rights by Holders of Units
Each unit agent will act solely as our agent under the applicable unit agreement and will not assume any obligation or relationship of agency or trust with any holder of any unit. A single bank or trust company may act as unit agent for more than one series of units. A unit agent will have no duty or responsibility in case of any default by us under the applicable unit agreement or unit, including any duty or responsibility to initiate any proceedings at law or otherwise, or to make any demand upon us. Any holder of a unit may, without the consent of the related unit agent or the holder of any other unit, enforce by appropriate legal action its rights as holder under any security included in the unit.
Title
We, the unit agent and any of its agents, may treat the registered holder of any unit certificate as an absolute owner of the units evidenced by that certificate for any purpose and as the person entitled to exercise the rights attaching to the units so requested, despite any notice to the contrary.
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We may sell the securities being offered hereby in one or more of the following methods from time to time:
| • |
a block trade (which may involve crosses) in which the broker or dealer so engaged will attempt to sell the securities as agent but may position and resell a portion of the block as principal to facilitate the transaction; |
| • |
purchases by a broker or dealer as principal and resale by such broker or dealer for its own account pursuant to this prospectus; |
| • |
exchange distributions and/or secondary distributions; |
| • |
ordinary brokerage transactions and transactions in which the broker solicits purchasers; |
| • |
to one or more underwriters for resale to the public or to investors; |
| • |
in “at the market offerings,” within the meaning of Rule 415(a)(4) of the Securities Act, to or through a market maker or into an existing trading market, on an exchange or otherwise; |
| • |
transactions not involving market makers or established trading markets, including direct sales or privately negotiated transactions; |
| • |
transactions in options, swaps or other derivatives that may or may not be listed on an exchange; or |
| • |
through a combination of these methods of sale. |
The securities that we distribute by any of these methods may be sold, in one or more transactions, at:
| • |
a fixed price or prices, which may be changed; |
| • |
market prices prevailing at the time of sale; |
| • |
prices related to prevailing market prices; or |
| • |
negotiated prices. |
We will set forth in a prospectus supplement the terms of the offering of securities, including:
| • |
the name or names of any agents or underwriters; |
| • |
the purchase price of the securities being offered and the proceeds we will receive from the sale; |
| • |
any over-allotment options under which underwriters may purchase additional securities from us; |
| • |
any agency fees or underwriting discounts and other items constituting agents’ or underwriters’ compensation; |
| • |
the public offering price; |
| • |
any discounts or concessions allowed or reallowed or paid to dealers; and |
| • |
any securities exchanges or markets on which such securities may be listed. |
If underwriters are used in the sale, they will acquire the securities for their own account and may resell the securities from time to time in one or more transactions at a fixed public offering price or at varying prices determined at the time of sale. The obligations of the underwriters to purchase the securities will be subject to the conditions set forth in the applicable underwriting agreement. We may offer the securities to the public through underwriting syndicates represented by managing underwriters or by underwriters without a syndicate. Subject to certain conditions, the underwriters will be obligated to purchase all of the securities offered by the prospectus supplement, other than securities covered by any over-allotment option. Any public offering price and any discounts or concessions allowed or reallowed or paid to dealers may change from time to time. We may use underwriters with whom we have a material relationship. We will describe in the prospectus supplement, naming the underwriter, the nature of any such relationship.
We may sell securities directly or through agents we designate from time to time. We will name any agent involved in the offering and sale of securities and we will describe any commissions we will pay the agent in the prospectus supplement. Unless the prospectus supplement states otherwise, our agent will act on a best-efforts basis for the period of its appointment.
We may also sell securities directly to one or more purchasers without using underwriters or agents.
13
Underwriters, dealers and agents that participate in the distribution of the securities may be underwriters as defined in the Securities Act and any discounts or commissions they receive from us and any profit on their resale of the securities may be treated as underwriting discounts and commissions under the Securities Act. We will identify in the applicable prospectus supplement any underwriters, dealers or agents and will describe their compensation. We may have agreements with the underwriters, dealers and agents to indemnify them against specified civil liabilities, including liabilities under the Securities Act. Underwriters, dealers and agents may engage in transactions with or perform services for us in the ordinary course of their businesses.
The warrants and the units that we may offer will be new issues of securities with no established trading market. Any underwriters may make a market in these securities, but will not be obligated to do so and may discontinue any market making at any time without notice. We cannot guarantee the liquidity of the trading markets for any securities.
Unless otherwise specified in the applicable prospectus supplement, each class or series of securities will be a new issue with no established trading market, other than our common stock, which is listed on The NASDAQ Global Market. We may elect to list any other class or series of securities on any exchange, but we are not obligated to do so. It is possible that one or more underwriters may make a market in a class or series of securities, but the underwriters will not be obligated to do so and may discontinue any market making at any time without notice. We cannot give any assurance as to the liquidity of the trading market for any of the securities.
In connection with an offering, an underwriter may purchase and sell securities in the open market. These transactions may include short sales, stabilizing transactions and purchases to cover positions created by short sales. Short sales involve the sale by the underwriters of a greater number of securities than they are required to purchase in the offering. “Covered” short sales are sales made in an amount not greater than the underwriters’ option to purchase additional securities, if any, from us in the offering. If the underwriters have an over-allotment option to purchase additional securities from us, the underwriters may close out any covered short position by either exercising their over-allotment option or purchasing securities in the open market. In determining the source of securities to close out the covered short position, the underwriters may consider, among other things, the price of securities available for purchase in the open market as compared to the price at which they may purchase securities through the over-allotment option. “Naked” short sales are any sales in excess of such option or where the underwriters do not have an over-allotment option. The underwriters must close out any naked short position by purchasing securities in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the securities in the open market after pricing that could adversely affect investors who purchase in the offering.
Accordingly, to cover these short sales positions or to otherwise stabilize or maintain the price of the securities, the underwriters may bid for or purchase securities in the open market and may impose penalty bids. If penalty bids are imposed, selling concessions allowed to syndicate members or other broker-dealers participating in the offering are reclaimed if securities previously distributed in the offering are repurchased, whether in connection with stabilization transactions or otherwise. The effect of these transactions may be to stabilize or maintain the market price of the securities at a level above that which might otherwise prevail in the open market. The impositions of a penalty bid may also affect the price of the securities to the extent that it discourages resale of the securities. The magnitude or effect of any stabilization or other transactions is uncertain. These transactions may be effected on The NASDAQ Global Market or otherwise and, if commenced, may be discontinued at any time.
In compliance with guidelines of the Financial Industry Regulatory Authority, or FINRA, the maximum consideration or discount to be received by any FINRA member or independent broker dealer may not exceed 8% of the aggregate amount of the securities offered pursuant to this prospectus and any applicable prospectus supplement.
14
Incorporation of Documents by Reference
The Securities and Exchange Commission allows us to incorporate by reference the information that we file with them. Incorporation by reference means that we can disclose important information to you by referring you to other documents that are legally considered to be part of this prospectus and later information that we file with the Securities and Exchange Commission will automatically update and supersede the information in this prospectus, any supplement and the documents listed below. Our Securities and Exchange Commission file number is 000-32469. We incorporate by reference the specific documents listed below:
| • |
our Annual Report on Form 10-K for the year ended December 31, 2008, filed with the SEC on March 16, 2009; |
| • |
our Quarterly Reports on Form 10-Q for the period ended March 31, 2009, filed with the SEC on May 8, 2009, and for the period ended June 30, 2009, filed with the SEC on August 7, 2009; |
| • |
our Current Reports on Form 8-K filed with the SEC on March 18, 2009, March 31, 2009 and April 20, 2009, and our amended Current Report on Form 8-K/A filed with the SEC on March 30, 2009; and |
| • |
The description of our common stock contained in the Registration Statement on Form 8-A, which was filed on March 20, 2001, and all amendments and reports updating such description. |
All documents filed by us under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act on or after the date of this prospectus until the date on which the registration statement containing this prospectus has been withdrawn shall also be deemed to be incorporated by reference in this prospectus and to be a part of this prospectus from the date of filing of those documents. Any statement contained in this prospectus or in a previously filed document incorporated or deemed to be incorporated by reference in this prospectus shall be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained in this prospectus or in any other subsequently filed document that also is or was deemed to be incorporated by reference in this prospectus modifies or supersedes that statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
The information relating to us contained in this prospectus should be read together with the information in the documents incorporated by reference.
Upon oral or written request and at no cost to the requester, we will provide to any person, including a beneficial owner, to whom a prospectus is delivered, a copy of any or all of the information that has been incorporated by reference in this prospectus but not delivered with this prospectus. All requests should be made to: The Princeton Review, Inc., 111 Speen Street, Framingham, Massachusetts 01701, Attn: Secretary. Telephone requests may be directed to the Secretary at (508) 663-5050. You should rely only on the information incorporated by reference or provided in this prospectus. We have not authorized anyone to provide you with different information. You should not assume that the information in this prospectus or the documents incorporated by reference is accurate as of any date other than the date on the front of this prospectus or those documents.
15
Where You Can Find More Information
We are subject to the informational requirements of the Exchange Act, and we are required to file reports and proxy statements and other information with the Securities and Exchange Commission. You may read and copy these reports, proxy statements and information at the Securities and Exchange Commission’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the Securities and Exchange Commission at 1-800-SEC-0330. The Securities and Exchange Commission maintains a web site that contains reports, proxy and information statements and other information regarding registrants, including The Princeton Review, Inc., that file electronically with the Securities and Exchange Commission. You may access the Securities and Exchange Commission’s web site at http://www.sec.gov.
This prospectus is part of a registration statement that we filed with the SEC. The registration statement contains more information than this prospectus regarding us and the securities, including exhibits and schedules. You can obtain a copy of the registration statement from the SEC at any address listed above or from the SEC’s web site.
The financial statements as of December 31, 2008 and for the year ended December 31, 2008 and management’s assessment of the effectiveness of internal control over financial reporting as of December 31, 2008 incorporated in this Prospectus by reference to the Annual Report on Form 10-K for the year ended December 31, 2008 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.
The consolidated financial statements of The Princeton Review, Inc. for the year ended December 31, 2007, incorporated by reference in this prospectus and registration statement, have been so incorporated by reference in reliance upon the report of Grant Thornton LLP, an independent registered public accounting firm.
The consolidated financial statements of The Princeton Review, Inc. for the year ended December 31, 2006, appearing in our Annual Report (Form 10-K) for the year ended December 31, 2008, have been audited by Ernst & Young LLP, an independent registered public accounting firm, as set forth in their report thereon included therein and incorporated herein by reference. Such consolidated financial statements are incorporated herein by reference in reliance upon such reports given on the authority of such firms as experts in accounting and auditing.
Goodwin Procter LLP, Boston, Massachusetts has passed upon the validity of the shares of our common stock offered by this prospectus. Any underwriters will also be advised about the validity of the securities and other legal matters by their own counsel, which will be named in the prospectus supplement.
16
$75,000,000
THE PRINCETON REVIEW, INC.
Common Stock
Warrants
Units
Preferred Stock
PROSPECTUS
, 2009
Part II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the estimated costs and expenses, other than underwriting discounts and commissions, payable by us in connection with the offering of the securities being registered. All the amounts shown are estimates, except for the SEC registration fee.
|
SEC registration fee |
$ | 4,185 | |
|
NASDAQ Global Market listing fee |
* | ||
|
Accountants’ fees and expenses |
* | ||
|
Legal fees and expenses |
* | ||
|
Transfer agent fees and expenses |
* | ||
|
Printing expenses |
* | ||
|
TOTAL |
$ | 4,185 | |
|
|
| * | Estimated expenses not presently known. |
| Item 15. | Indemnification of Directors and Officers. |
Section 102 of the Delaware General Corporation Law, or the DGCL, allows a corporation to eliminate the personal liability of directors of the corporation to the corporation or its stockholders for monetary damages for a breach of fiduciary duty as a director, except for liability:
| - | for any breach of the director’s duty of loyalty to the corporation or its stockholders; |
| - | for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law; |
| - | under section 174 of the DGCL regarding unlawful dividends and stock purchases; or |
| - | for any transaction from which the director derived an improper personal benefit. |
Our certificate of incorporation includes a provision that eliminates the personal liability of our directors for monetary damages for breach of fiduciary duty as a director, except to the extent such exemption from liability is expressly forbidden by the DGCL, as it now exists or is later amended.
Section 145 of the DGCL provides that a corporation may indemnify directors and officers as well as other employees and individuals against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with any threatened, pending or completed actions, suits or proceedings in which such person is made a party by reason of such person being or having been a director, officer, employee of or agent of the corporation. The statue provides that it is not exclusive of other rights to which those seeking indemnification may be entitled under any by-law, agreement, vote of stockholders or disinterested directors or otherwise.
Our certificate of incorporation requires us to indemnify to the fullest extent authorized or permitted by the DGCL (as it existed at the time of the adoption of the certificate of incorporation, or, if the DGCL is later amended to permit broader indemnification, as so amended) each person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal administrative or investigative, by reason of the fact that he is or was a director or officer of The Princeton Review, Inc., or is or was serving at the request of The Princeton Review, Inc. as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, including service with respect to employee benefit plans, whether the basis of such proceeding is alleged action in an official capacity as a director, officer, employee or agent, or in any other capacity while serving as a director, officer, employee or agent. We are only required to indemnify any such person seeking indemnification in connection with an action initiated by such person if such action was authorized by the board of directors. Our certificate of incorporation also provides that we must advance expenses to a director or officer in advance of the final disposition of the matter with respect to which such expenses are being advanced upon receipt of an undertaking, if such undertaking is required by the DGCL, by or on behalf of such director or officer to repay such amount if it is ultimately determined that the director or officer is not entitled to be indemnified by us. Our certificate of incorporation further states that we may, by action of our board of directors, provide indemnification to employees and agents of the company with the same scope and effect as the foregoing provisions relating to directors and officers.
Our certificate of incorporation provides that the rights to indemnification and advancement of expenses conferred by it are not exclusive of any other right that any person may have or acquire under any statute, any amendment to the certificate of incorporation, by-laws, agreement, vote of stockholders or disinterested directors or otherwise.
We currently maintain directors and officers liability insurance.
| Item 16. | Exhibits and Financial Statement Schedules. |
A list of exhibits filed with this registration statement on Form S-3 is set forth on the Exhibit Index and is incorporated herein by reference.
| 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;
(ii) To reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the Registration Statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement.
(iii) To include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the registration statement.
provided,
however,
that paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) of this section do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or
furnished to the Securities and Exchange Commission by the registrant pursuant to Section 13 or 15(d) of the Exchange Act that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed
pursuant to
Rule 424(b).
(2) That, for the purpose of determining any liability under the Securities Act, 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 the purpose of determining liability under the Securities Act to any purchaser:
(i) Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and
(ii) Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5) or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however , that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.
(5) That, for the purpose of determining liability of the registrant under the Securities Act to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such
II-2
purchaser:
(i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
(ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
(iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
(iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
(6) That, for purposes of determining any liability under the Securities Act, each filing of the registrant’s annual report pursuant to section 13(a) or section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to section 15(d) of the Exchange Act) 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.
(7) That, for purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.
(8) That, for the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and 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 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement (the “Registration Statement”) to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Framingham, Commonwealth of Massachusetts, on this 24 th day of September, 2009.
| THE PRINCETON REVIEW, INC. | ||
| By: | /s/ Michael J. Perik | |
|
Michael J. Perik President and Chief Executive Officer |
||
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Michael J. Perik, Stephen C. Richards and Neal S. Winneg, and each of them, as his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this Registration Statement and sign any registration statement (or amendment thereto) for the same offering covered by the Registration Statement that is to be effective upon filing pursuant to Rule 462 promulgated under the Securities Act of 1933, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith 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 attorneys-in-fact and agents, or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
|
Signature |
Capacity |
Date |
||
|
/s/ Michael J. Perik Michael J. Perik |
President and Chief Executive Officer (Principal Executive Officer) and Director | September 24, 2009 | ||
|
/s/ Stephen Richards Stephen Richards |
Chief Operating Officer and Chief Financial Officer (Principal Financial Officer) | September 24, 2009 | ||
|
/s/ Susan Rao Susan Rao |
Executive Vice President, Finance (Principal Accounting Officer) | September 24, 2009 | ||
|
/s/ David Lowenstein David Lowenstein |
Chairman of the Board of Directors | September 24, 2009 | ||
|
/s/ Jeffrey R. Crisan Jeffrey R. Crisan |
Director | September 24, 2009 | ||
|
/s/ Robert E. Evanson Robert E. Evanson |
Director | September 24, 2009 | ||
|
/s/ Richard Katzman Richard Katzman |
Director | September 24, 2009 | ||
|
/s/ Michael A. Krupka Michael A. Krupka |
Director | September 24, 2009 | ||
|
/s/ Linda Whitlock Linda Whitlock |
Director | September 24, 2009 | ||
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Exhibit Index
| * | To be filed by amendment or as an exhibit to a document to be incorporated or deemed to be incorporated by reference in this registration statement, including a Current Report on Form 8-K. |
| ** | Previously filed. |
Exhibit 5.1
September 24, 2009
The Princeton Review, Inc.
111 Speen Street
Framingham, Massachusetts 01701
| Re: | Securities Being Registered under Registration Statement on Form S-3 |
Ladies and Gentlemen:
This opinion letter is furnished to you in connection with your filing of a Registration Statement on Form S-3 (as amended or supplemented, the “Registration Statement”) pursuant to the Securities Act of 1933, as amended (the “Securities Act”), relating to the registration of up to $75,000,000 of any combination of (i) common stock, par value $.01 per share, of The Princeton Review, Inc., a Delaware corporation (the “Company”) ( “Common Stock”), (ii) preferred stock, par value $.01 per share, of the Company ( “Preferred Stock”), (iii) warrants to purchase Common Stock or Preferred Stock ( “Warrants”), and (iv) units comprised of Common Stock, Preferred Stock, and/or Warrants in any combination ( “Units”). Common Stock, Preferred Stock, Warrants and Units are referred to collectively herein as the “Securities.” The Registration Statement registers an unspecified number of shares of Common Stock, Preferred Stock, Warrants and Units. The Registration Statement provides that the Securities may be offered separately or together, in separate series, in amounts, at prices and on terms to be set forth in one or more prospectus supplements (each a “Prospectus Supplement”) to the prospectus contained in the Registration Statement (the “Prospectus”).
We have reviewed such documents and made such examination of law as we have deemed appropriate to give the opinions expressed below. We have relied, without independent verification, on certificates of public officials and, as to matters of fact material to the opinions set forth below, on certificates of officers of the Company.
The opinions expressed below are limited to the Delaware General Corporation Law (which includes reported judicial decisions interpreting the Delaware General Corporation Law).
Express assumptions to which the opinions set forth below are subject are as follows:
| i. | the Company continues to be validly existing as a corporation; |
| ii. | all required authorizations and approvals have been received from, and all notices given to and documents filed with, governmental authorities and regulatory bodies to the extent required by applicable law; |
| iii. | after the issuance of any Securities offered pursuant to the Registration Statement, the total number of issued shares of Common Stock or Preferred Stock, as applicable, together with the total number of shares of such stock committed to be issued upon the exercise, exchange, conversion or settlement, as the case may be, of any security then outstanding (including Warrants and Units), will not exceed the total number of authorized shares of Common Stock or Preferred Stock, as applicable, under the Company’s Certificate of Incorporation, as amended and then in effect (the “Charter”); |
The Princeton Review, Inc.
September 24, 2009
Page 2
| iv. | with respect to shares of Common Stock and Preferred Stock (a) all such shares have been duly authorized, (b) the issuance of such shares shall have been approved by all necessary corporate action, and (c) such shares shall have been issued in accordance with the terms by which their issuance was approved, including the receipt by the Company of the consideration called for by such terms, which consideration was not less than the par value of such shares; |
| v. | with respect to shares of Preferred Stock, (a) the terms of such Preferred Stock shall have been established in conformity with the Charter and applicable law and (b) the certificate of designations to the Charter setting forth the terms of such Preferred Stock shall have been duly executed and filed with governmental authorities in accordance with the Charter and applicable law; and |
| vi. | with respect to Warrants and Units, (a) the terms and issuance of such Warrants or Units, as applicable, shall have been approved by all necessary corporate action; (b) the terms of such Warrants or Units, as applicable, shall have been duly established so as to not violate any applicable law or result in a default under or breach of any agreement or instrument binding upon the Company and to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company or any of its property; (c) agreements representing such Warrants or Units, as applicable, shall have been duly authorized, executed and delivered; and (d) such Warrants or Units, as applicable, shall have been issued in accordance with the terms by which their issuance was approved, including the receipt by the Company of the consideration called for by such terms. |
Based upon the foregoing, and subject to the additional qualifications set forth below, we are of the opinion that:
| 1. | The shares of Common Stock will be validly issued, fully paid and nonassessable. |
| 2. | The shares of Preferred Stock will be validly issued, fully paid and nonassessable. |
| 3. | The Warrants and/or Units will be valid and binding obligations of the Company. |
The opinions expressed above, as they relate to Warrants and Units are subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other similar laws of general application affecting the rights and remedies of creditors and to general principles of equity.
This opinion letter and the opinions it contains shall be interpreted in accordance with the Legal Opinion Principles issued by the Committee on Legal Opinions of the American Bar Association’s Business Law Section as published in 53 Business Lawyer 831 (May 1998).
The Princeton Review, Inc.
September 24, 2009
Page 3
We hereby consent to the inclusion of this opinion as Exhibit 5.1 to the Registration Statement and to the references to our firm under the caption “Legal Matters” in the Registration Statement. In giving our consent, we do not admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations thereunder.
| Very truly yours, |
| /s/ Goodwin Procter LLP |
| GOODWIN PROCTER LLP |
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the incorporation by reference in this Registration Statement on Form S-3 of our report dated March 16, 2009 relating to the financial statements, financial statement schedule and the effectiveness of internal control over financial reporting, which appears in The Princeton Review Inc.’s Annual Report on Form 10-K for the year ended December 31, 2008. We also consent to the reference to us under the heading “Experts” in such Registration Statement.
/s/ PricewaterhouseCoopers LLP
Boston, Massachusetts
September 24, 2009
Exhibit 23.2
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We have issued our report dated March 17, 2008, except for Note 3 which is dated March 16, 2009 with respect to the consolidated financial statements and schedule of The Princeton Review, Inc. appearing in the Annual Report on Form 10-K for the year ended December 31, 2008 which is incorporated by reference in this Registration Statement. We consent to the incorporation by reference in the Registration Statement of the aforementioned reports and to the use of our name as it appears under the caption “Experts.”
/s/ GRANT THORNTON LLP
New York, New York
September 24, 2009
Exhibit 23.3
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the reference to our firm under the caption “Experts” in the Registration Statement (Form S-3 No. 333-00000) and related Prospectus of The Princeton Review, Inc. regarding the sale of up to $75 million of any combination of common stock, warrants, units and preferred stock and to the incorporation by reference therein of our report dated March 30, 2007 (except for Notes 11 and 14, as to which the date is March 17, 2008 and Note 3, as to which the date is March 16, 2009) with respect to the consolidated financial statements and schedule of The Princeton Review, Inc. included in its Annual Report (Form 10-K) for the year ended December 31, 2008, filed with the Securities and Exchange Commission.
/s/ ERNST & YOUNG LLP
New York, New York
September 24, 2009