| IPO Company Profile | |||
| U.S. Legal Support, Inc. | |||
| Proposed Ticker: | LEGL | 1001 Fannin Street, Suite 650 | |
| Exchange: | NASDAQ-National Market | Houston, TX 77002 | |
| Industry: | Service (SIC Code 7338) | (713) 653-7100 | |
| # of Employees: | 300 | ||
| Filing Information | |||||
| Shares Offered: | Common Shares | Filing Date: | 9/26/97 | |
| U.S. Shares Filed: | 3,100,000 | Filing Range: | $10.00 - $12.00 | |
| Non-U.S. Shares Filed: | - | Offering Amount: | $34,100,000 | |
| Primary Shares: | 3,100,000 | Expenses: | - | |
| Secondary Shares: | - | Shares Out After: | 7,814,136 |
| Primary Underwriting Group | ||
| Manager | Tier | Phone |
| Montgomery Securities | Lead Manager | (415) 627-2100 |
| Hambrecht & Quist Incorporated | Co-manager | (415) 439-3626 |
| J.C. Bradford & Co. | Co-manager | (615) 748-9347 |
| Legal Counsel, Auditor and Registrar | ||
| Issuer's Law Firm: | Bracewell & Patterson | |
| Bank's Law Firm: | Locke, Purnell, Rain & Harrell | |
| Auditor: | Coopers & Lybrand | |
| Selected Financial Data | |||||
| 6 Month Ending Financials | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Unaudited Income | Balance Sheet | ||
| 12/31/96 | 6/30/97 | 6/30/96 | 6/30/97 | ||
| Revenue: | $7.67 | $8.75 | $4.04 | Assets: | $14.11 |
| Net Income: | $0.02 | $0.03 | $0.23 | Curr Assets: | $4.38 |
| EPS: | Liabilities: | $16.61 | |||
| Prior EPS: | Curr Liab: | $4.04 | |||
| Cash Flow/Oper: | Equity: | -$2.50 | |||
| Cash Flow/Fin: | Cash: | $6.00 | |||
| Cash Flow/Inv: | Working Cap: | $0.34 | |||
| (Dollar amounts in U.S. millions except for per share data) | |||||
| Business Description |
| The company is one of the largest providers of legal support and staffing services in the U.S., providing court reporting, certified record retrieval, legal placement and staffing, and related services to law firms and corporations. The Company seeks to become the leading national, full service provider of legal support and staffing services through a combination of selective acquisitions and internal growth. Since commencing operations in January 1997, the Company has acquired 14 businesses and will acquire four additional businesses concurrently with the Offering. In 1997, the Company has provided legal support and staffing services to The Boeing Company, Ford Motor Company, ITT Hartford, CNA and RJ Reynolds Tobacco Company, among others. For the year ended December 31, 1996 and the six months ended June 30, 1997, the Company had pro forma revenues of $43.4 million and $23.8 million, respectively, and pro forma operating income of $5.1 million and $3.4 million, respectively. Based on available industry data, the Company estimates that the market for legal support and staffing services in the United States exceeds $5.0 billion annually. The industry is highly fragmented, with more than 1,000 court reporting and record retrieval firms and over 400 legal placement and staffing firms. The Company believes that the legal support and staffing services market is growing due to several trends, including: (i) an increase in the outsourcing of legal support services by law firms and corporations, including insurance providers, to companies that specialize in providing such services at a lower cost; (ii) an increase in the use of attorneys on a temporary basis by law firms and corporations; (iii) an increase in the volume and complexity of litigation; and (iv) an increase in the national scope of litigation, particularly in class action and product liability lawsuits. |
| Competition |
| The legal support and staffing services business is highly competitive and fragmented, and limited barriers to entry exist with respect to each component of the Company's business. The Company's court reporting and certified record retrieval businesses compete locally and regionally with numerous firms. In its legal staffing business, the Company competes with national, regional and local firms, some of which have substantially greater resources, offer more diversified services and operate in broader geographic areas than the Company. As the Company seeks to expand into new geographic markets, its growth in those markets will depend upon its ability to gain market share from competitors, and there can be no assurance that additional market share will be obtained. Prices for legal support services generally have remained stable or have declined in many markets over the past several years as law firms, insurance providers and corporations have increased their efforts to reduce expenses by centralizing their purchasing decisions and negotiating lower rates with vendors. As this trend and the related consolidation among legal support service companies continue, the Company anticipates that it will encounter more intense price-based competition which could adversely affect the Company's profitability. |
| Business Plan |
| The Company seeks to become the leading national, full-service provider of legal support and staffing services in the United States. To achieve this goal, the Company is implementing a focused business strategy that includes the following key elements:(I) Establish Full Service Operations in Multiple Metropolitan Areas, (ii) Adopt Best Proactices, Policies and Procedures, (iii) Achieve Operating Efficiences and (iv) Maintain Decentralized Management. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used to repay indebtedness, to pay a portion of the purchase price associated with the Pending Acquisitions and to redeem shares of the company's Series C Preferred Stock. |
| Principal and Selling Shareholders | |||
| Name of Shareholder | % Owned Before | % Owned After | |
| Richard O. Looney | 53.60% | 13.10% | |
| Robert J. Cresci | 47.30% | 20.00% | |
| Delaware State Employees' Retirement Fund | 37.60% | 13.40% | |
| Declaration of Trust for Defined Benefit Plan of ICI American Holdings Inc. | 14.90% | 3.90% | |
| Declaration of Trust for Defined Benefit Plan of Zeneca Holdings Inc. | 10.80% | 2.70% | |
| Michael A. Klein | 9.80% | 2.20% | |
| Greg M. And Susan L. Ziskind | 9.20% | 2.00% | |
| GulfStar Investments, Ltd. | 8.60% | 1.90% | |
| G. Kent Kahle | 8.60% | 1.90% | |
| Amicus One | 6.70% | 1.50% | |
| Tony Maddocks | 6.00% | 1.30% | |
| Legal Enterprise, Inc. | 5.30% | 1.20% | |
| Executive Officers and Directors | |||
| Officer Name | Title | Age | |
| Richard O. Looney | Chairman of the Board, President and Chief Executive Officer | 40 | |
| Michael A. Klein | Director; President--Klein Bury | 52 | |
| David W. Pfleghar | Vice President, Chief Financial Officer and Treasurer | 50 | |
| James M. Wilson | Vice President, Legal Staffing | 48 | |
| Tony L. Maddocks | Vice President, Sales and Marketing | 40 | |
Jackson Heights, NY 11372 212-332-0071[email protected]
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