HireQuest, Inc S-3, filed May 25, 2022
HireQuest, Inc. (HQI)
As filed with the Securities and Exchange Commission on May 25, 2022
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
HIREQUEST, INC.
(Exact name of registrant as specified in its charter)
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Delaware |
91-2079472 |
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(State of incorporation or organization) |
(I.R.S. employer identification no.) |
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111 Springhall Drive, Goose Creek, SC 29445, (843) 723-7400 |
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(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
John D. McAnnar Chief Legal Officer HireQuest, Inc. 111 Springhall Drive Goose Creek, SC 29445 (843) 723-7400 (Name, address, including zip code, and telephone number, including area code, of agent for service) |
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Copies to:
Roland S. Chase
Zachary W. Watt
Hill Ward Henderson
101 E. Kennedy Blvd., Suite 3700
Tampa, Florida 33602
(813) 221-3900
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, as amended, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box: ☑
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and the 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 file, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☐ Accelerated filer ☐
Non-accelerated filer ☑ Smaller reporting company ☑
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐
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 Commission acting pursuant to said section 8(a) may determine.
The information in this preliminary 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 preliminary prospectus is not an offer to sell these securities and is not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted.
SUBJECT TO COMPLETION DATED MAY 25, 2022
PROSPECTUS
$100,000,000
HireQuest, Inc.
Common Stock
Preferred Stock
Debt Securities
Warrants
Units
Rights
We may offer and sell, from time to time at prices and on terms to be determined at or prior to the time of the offering, up to $100,000,000 of any combination of the securities described in this prospectus, either individually or in units. We may also offer securities as may be issuable upon conversion, redemption, repurchase, exchange or exercise of any securities registered hereunder, including any applicable anti-dilution provisions.
This prospectus describes the general manner in which our securities may be offered using this prospectus. Each time we offer and sell securities, we will provide you with a prospectus supplement that will contain specific information about the terms of that offering. 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 free writing prospectus may also add, update, or change information contained in this prospectus. If information in any prospectus supplement is inconsistent with the information in this prospectus, then the information in that prospectus supplement will apply and will supersede the information in this prospectus. You should carefully read this prospectus, the applicable prospectus supplement, and any free writing prospectus as well as the documents incorporated or deemed to be incorporated by reference in this prospectus before you purchase any of the securities offered hereby.
Our common stock is listed on the Nasdaq Stock Market (“Nasdaq”) under the symbol “HQI.” On May 23, 2022, the closing price of our common stock as reported on Nasdaq was $14.67 per share. We recommend that you obtain current market quotations for our common stock prior to making an investment decision.
We may offer the shares in amounts, at prices, and on terms determined by market conditions at the time of the offering. We may sell shares through agents, underwriters, or dealers we select. We may also sell shares directly to investors. We may offer and sell shares in an “at the market offering” as defined in Rule 415(a)(4) under the Securities Act. Such offering may be made into an existing trading market for such securities in transactions at other than a fixed price. If we use agents, underwriters, or dealers to sell the shares, we will name them and describe their compensation in a prospectus supplement. For additional information regarding the methods of sale, you should refer to the section entitled “Plan of Distribution” in this prospectus and in any applicable prospectus supplement.
Investing in our securities involves a high degree of risk. See the section entitled “Risk Factors” on page 4 of this prospectus and in the documents incorporated by reference into this prospectus for a discussion of risks that should be considered in connection with an investment in our securities.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities, or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.
The date of this Prospectus is , 2022
TABLE OF CONTENTS
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Prospectus Summary and Company Information |
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Risk Factors |
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Special Note Regarding Forward-Looking Statements |
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Use of Proceeds |
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Dilution |
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Description of Capital Stock |
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Description of Debt Securities |
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Description of Warrants |
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Description of Units |
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Description of Subscription Rights |
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Plan of Distribution |
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Legal Matters |
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Experts |
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Where You Can Find More Information |
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Incorporation of Certain Information by Reference |
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You should rely only on the information contained in this prospectus, any prospectus supplement, and any free-writing prospectus that we authorize to be distributed to you. We have not authorized anyone to provide you with information different from or in addition to that contained in this prospectus, any prospectus supplement, or any related free-writing prospectus. If anyone provides you with different or inconsistent information, you should not rely on it.
We are offering to sell, and are seeking offers to buy, the securities offered by this prospectus only in jurisdictions where offers and sales are permitted.
The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the securities. Our business, financial conditions, results of operations and prospects may have changed since that date. You should read and consider this prospectus along with any prospectus supplements and the related exhibits, together with the information in the documents to which we have referred you under the caption “Where You Can Find More Information” and “Incorporation of Certain Information by Reference” in this prospectus before making your investment decision.
PROSPECTUS SUMMARY AND COMPANY INFORMATION
This summary highlights information contained in other parts of this prospectus or incorporated by reference into this prospectus from our filings with the Securities and Exchange Commission, or SEC, listed in the section of the prospectus entitled “Incorporation of Certain Information by Reference.” This summary does not contain all of the information that you should consider before deciding to invest in our securities. You should read this entire prospectus, including any amendment or supplement, carefully before making an investment decision, including the “Risk Factors” section and our historical financial statements and the notes to our historical financial statements incorporated herein by reference.
About this Prospectus
This prospectus is part of a shelf registration statement on Form S-3 that we filed with the SEC using a “shelf” registration process. By using this shelf registration process, we may sell any combination of the securities described in this prospectus in one or more offerings up to a total dollar amount of $100,000,000. This prospectus provides you with the general description of the securities we may offer. Each time we offer securities, we will provide you with a prospectus supplement that describes the specific amounts, prices, and terms of the securities we offer. The prospectus supplement also may add, update, or change information in this prospectus.
This prospectus does not contain all the information provided in the registration statement we filed with the SEC. You should read both this prospectus, including the section titled “Risk Factors,” and any prospectus supplement, together with the additional information described under the headings “Where You Can Find More Information” and “Incorporation of Certain Information by Reference.”
You should rely only on the information contained or incorporated by reference in this prospectus or a prospectus supplement. We have not authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. This prospectus is not an offer to sell securities, and it is not soliciting an offer to buy securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus or any prospectus supplement, as well as information we have previously filed with the SEC and incorporated by reference, is accurate as of the date on the front of those documents only. Our business, financial condition, results of operations, and prospects may have changed since those dates.
Business Overview
We are a nationwide franchisor of offices providing direct-dispatch and commercial staffing solutions in the light industrial and blue-collar segments of the staffing industry and traditional commercial staffing. Our franchisees provide various types of temporary personnel through a number of business models operating under the trade names “HireQuest Direct”, “HireQuest”, “Snelling”, “LINK Staffing”, “DriverQuest”, “HireQuest Health”, and “Northbound Executive Search”. HireQuest Direct specializes primarily in unskilled and semi-skilled industrial and construction personnel. HireQuest, Snelling, and Link specialize primarily in skilled and semi-skilled industrial personnel, clerical and administrative personnel, and permanent placement services. DriverQuest specializes in commercial drivers serving a variety of industries and applications. HireQuest Health specializes in skilled personnel in the medical and dental industries. Northbound Executive Search specializes in executive placement and consultant services in the financial services industry. As of March 31, 2022 we had 224 franchisee-owned offices and 2 company owned offices in 38 states and the District of Columbia. We provide employment for an estimated 75 thousand temporary employees annually working for thousands of clients in many industries including construction, recycling, warehousing, logistics, auctioneering, manufacturing, hospitality, landscaping, and retail.
Recent Developments
On March 1, 2021, we completed our acquisition of certain assets of Snelling Staffing. Snelling is a 67-year-old staffing company headquartered in Richardson, TX. HQ Snelling Corporation, our wholly-owned subsidiary, acquired substantially all of the operating assets and assumed certain liabilities of the sellers.
On March 22, 2021, we completed our acquisition of the franchise relationships and certain other assets of Link Staffing. Link Staffing is a family-owned staffing company headquartered in Houston, TX. HQ Link Corporation, our wholly-owned subsidiary, acquired franchise agreements for approximately 35 locations, and other assets of Link Staffing.
On October 1, 2021 we completed our acquisition of Recruit Media, Inc. (“Recruit Media”), in which we purchased all of the outstanding shares of common stock of Recruit Media. Recruit Media is a tuck-in acquisition whose intellectual property compliments our technological structure, allowing us to accelerate improvements to our platform.
On December 6, 2021 we completed our acquisition of the Dental Power Staffing division (“DPS”) of Dental Power International, Inc. (“Dental Power”). Dental Power is a 46-year-old dental staffing company headquartered in Carrboro, North Carolina with long-standing client relationships in the dental industry providing temporary, long-term contract, and direct-hire staffing services to dental practices across the U.S. As of March 31, 2022, all of the operations acquired from Dental Power remain company owned.
On January 24, 2022 we completed our acquisition of certain assets of Temporary Alternatives, Inc. (“Temporary Alternatives”) including three locations in West Texas and New Mexico. Temporary Alternatives is a staffing division of dmDickason Personnel Services, a family-owned company based in El Paso, TX. The acquisition of Temporary Alternatives will expand our national footprint into West Texas and grow our franchise base.
On February 21, 2022 we completed our acquisition of certain assets of The Dubin Group, Inc., and Dubin Workforce Solutions, Inc. (collectively, “Dubin”) consisting of their staffing operations. Dubin provides executive placement services and commercial staffing in the Philadelphia metro area. The acquisition of Dubin will help expedite growth into a new staffing vertical, expand our national footprint, and grow our franchise base.
On February 28, 2022 we completed our acquisition of certain assets of Northbound Executive Search, LTD. (“Northbound”). Northbound provides executive placement and short-term consultant services primarily to blue chip clients in the financial services industry. The acquisition of Northbound will help expedite growth into a new staffing vertical, expand our national footprint, and grow our franchise base.
Corporate Information
HireQuest, Inc. is a Delaware corporation originally organized in Washington as Command Staffing, LLC in 2002. In 2005, Temporary Financial Services, Inc., a public company, acquired the assets of Command Staffing, LLC, and the combined entity changed its name to Command Center, Inc. (“Command Center”).
On September 11, 2019, Command Center, Inc. reincorporated in Delaware and changed its name to Hire Quest, Inc. following its acquisition of Hire Quest Holdings, LLC (“Hire Quest Holdings,” and together with its subsidiary, Hire Quest, LLC, “Legacy HQ”). Hire Quest, LLC was formed as a Florida limited liability company in 2002. Hire Quest Holdings, LLC was formed as a Florida limited liability company in 2017. Unless the context otherwise requires, in this prospectus, references to the “Company,” “we,” “us,” and “our” refer to HireQuest, Inc.
Our common stock trades on the NASDAQ Stock Market under the symbol “HQI.” More information about us may be found at www.hirequest.com. The information on our website is not incorporated by reference in this prospectus.
Address and Telephone Number
Our principal executive offices are located at 111 Springhall Drive, Goose Creek, South Carolina 29445. We may also be reached by telephone at (843) 723-7400. Our website is www.hirequest.com. Information contained on or accessible through our website is not part of this prospectus.
RISK FACTORS
Investing in our securities involves a high degree of risk. Before making an investment decision, you should consider carefully the risks, uncertainties, and other factors described under the heading “Risk Factors” contained in any applicable prospectus supplement and any related free writing prospectus, and discussed under the heading “Risk Factors” contained in our most recent Annual Report on Form 10-K, as supplemented and updated by subsequent quarterly reports on Form 10-Q and current reports on Form 8-K that we have filed or will file with the SEC, which are incorporated by reference in this prospectus. The risks described in these documents are not the only ones we face, but those that we consider to be material. There may be other unknown or unpredictable economic, business, competitive, regulatory, or other factors that could have material adverse effects on our future results. Past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results or trends in future periods.
Our business, affairs, prospects, assets, financial condition, results of operations, and cash flows could be materially and adversely affected by these or other risks. Such effects could cause the trading price of our common stock to decline, resulting in a loss of all or part of your investment. For more information about our SEC filings, please see “Where You Can Find More Information.” Please also read carefully the discussion immediately following under the heading “Special Note Regarding Forward-Looking Statements.”
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus along with any applicable supplemental or free-writing prospectus including the documents we incorporate by reference herein and therein may include, and our officers and other representatives may sometimes make or provide certain estimates and other forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including, among others, statements regarding our strategy; statements with respect to future revenue, franchise sales, system-wide sales, and the growth thereof; the impact of any global pandemic including COVID-19; operating results; anticipated benefits of various acquisitions or our franchise model; anticipated impacts of regulatory requirements; intended office openings or closings; expectations of the effect on our financial condition of claims and litigation; strategies for customer retention and growth; strategies for risk management; and all other statements that are not purely historical and that may constitute statements of future expectations. Forward-looking statements can be identified by words such as: “anticipate,” “intend,” “plan,” “goal,” “seek,” “believe,” “project,” “estimate,” “expect,” “strategy,” “future,” “likely,” “may,” “should,” “will,” and similar references to future periods.
While we believe these statements are accurate, forward-looking statements are not historical facts and are inherently uncertain. They are based only on our current beliefs, expectations, and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy, and other future conditions. We cannot assure you that these expectations will occur, and our actual results may be significantly different. Therefore, you should not place undue reliance on these forward-looking statements. Important factors that may cause actual results to differ materially from those contemplated in any forward-looking statements made by us include the following: the level of demand and financial performance of the temporary staffing industry; the financial performance of our franchisees; the impacts of COVID-19 or other diseases or pandemics; changes in customer demand; the extent to which we are successful in gaining new long-term relationships with customers or retaining existing ones, and the level of service failures that could lead customers to use competitors’ services; significant investigative or legal proceedings including, without limitation, those brought about by the existing regulatory environment or changes in the regulations governing the temporary staffing industry and those arising from the action or inaction of our franchisees and temporary employees; strategic actions, including acquisitions and dispositions and our success in integrating acquired businesses; disruptions to our technology network including computer systems and software whether resulting from a cyber attack or otherwise; natural events such as severe weather, fires, floods, and earthquakes, or man-made or other disruptions of our operating systems or the economy including by war; and the factors discussed in the “Risk Factors” section and elsewhere in this prospectus, any prospectus supplement, any free-writing prospectus, in our most recent Annual Report on Form 10-K, and in our Quarterly Reports on Form 10-Q.
In light of the risks and uncertainties facing the Company, the future events and trends discussed in this prospectus may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.
Any forward-looking statement made by us in this prospectus, any supplemental prospectus, or any free-writing prospectus and in the documents incorporated herein and therein by reference is based only on information currently available to us and speaks only as of the date on which it is made. The Company disclaims any obligation to update or revise any forward-looking statement, whether written or oral, that may be made from time to time, based on the occurrence of future events, the receipt of new information, or otherwise, except as required by law. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. All forward-looking statements are qualified in their entirety by this cautionary statement.
USE OF PROCEEDS
We will retain broad discretion over the use of the net proceeds from the sale of the securities offered hereby. Unless otherwise specified in a prospectus supplement accompanying this prospectus, the net proceeds from the sale by us of the common stock to which this prospectus relates will be used to advance our growth initiatives, including acquisitions, to finance working capital needs and for other general corporate purposes. We have no current plans or arrangements concerning specific acquisitions to be funded with proceeds of the common stock offered by this prospectus. Our expected use of proceeds from the sale of common stock offered hereby represents our current intentions based on our present plans and business condition.
As of the date of this prospectus, we cannot predict with any reasonable certainty all of the particular uses for the proceeds to be received from the sale of the common stock offered hereby or the amounts that we will actually spend on the uses listed above. When we offer and sell the common stock to which this prospectus relates, the prospectus supplement related to such offering will set forth our intended use of the proceeds, if any, received from the sale of common stock.
Pending the use of the net proceeds, we may invest the proceeds in interest-bearing, investment-grade securities, certificates of deposit, or government securities.
DILUTION
We will set forth in a prospectus supplement the following information regarding any material dilution of the equity interests of investors purchasing securities in an offering under this prospectus:
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the net tangible book value per share of our equity securities before and after the offering; |
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the amount of the increase in such net tangible book value per share attributable to the cash payments made by purchasers in the offering; and |
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the amount of the immediate dilution from the public offering price which will be absorbed by such purchasers. |
DESCRIPTION OF CAPITAL STOCK
The following descriptions are summaries of the material terms of (i) our certificate of incorporation and bylaws and (ii) applicable provisions of Delaware law. Reference is made to the more detailed provisions of, and the descriptions are qualified in their entirety by reference to, the certificate of incorporation and bylaws, copies of which are incorporated by reference into the registration statement of which this prospectus is a part.
Authorized, Issued and Outstanding Capital Stock
The Company’s authorized capital stock consists of 30,000,000 shares of common stock, par value $0.001 per share (“common stock”), and 1,000,000 shares of preferred stock, par value $0.001 per share (“preferred stock”). As of May 23, 2022, 13,786,555 shares of our common stock and no shares of our preferred stock were issued and outstanding.
Common Stock
Dividends. Holders of shares of our common stock will be entitled to receive dividends when, as and if declared by our Board of Directors (the “Board”) at its discretion out of funds legally available for that purpose, subject to the preferential rights of any outstanding shares of preferred stock. The timing, declaration, amount and payment of future dividends depends on the Company’s financial condition, earnings, capital requirements and debt service obligations, as well as legal requirements, regulatory constraints, industry practice and other factors that the Board deems relevant. The Company’s Board makes all decisions regarding its payment of dividends from time-to-time in accordance with applicable law.
Voting Rights. The holders of the Company’s common stock are entitled to one vote for each share held of record on all matters submitted to a vote of the stockholders. With certain exceptions, a majority of the votes cast at a stockholder meeting at which a quorum is present must approve all stockholder matters. Except with respect to vacancies or new directorships, the Company’s Bylaws provide that directors are elected by a plurality of the votes cast on the election of directors at a stockholder meeting at which a quorum is present. The holders of the Company’s common stock do not have cumulative voting rights for the election of directors or for any other purpose.
Other Rights. Subject to any preferential liquidation rights of holders of Preferred stock that may be outstanding, upon the Company’s dissolution, the holders of common stock will be entitled to share ratably in its assets legally available for distribution to the Company’s stockholders. The holders of the common stock do not have preemptive rights or preferential rights to subscribe for shares of the Company’s capital stock.
Fully Paid. The issued and outstanding shares of common stock are fully paid and non-assessable. Any additional shares of common stock that may be issued in the future will also be fully paid and non-assessable.
Preferred Stock
The Company currently has no outstanding shares of preferred stock. The Company is authorized to issue up to 1,000,000 shares of preferred stock in one or more class or series. The Board, without further action by the holders of the common stock, may issue shares of preferred stock. The Board is vested with the authority to fix by resolution the designations, preferences and relative, participating, optional or other special rights, and the qualifications, limitations or restrictions of any preferred stock issued, including, without limitation, redemption rights, dividend rights, liquidation preferences and conversion or exchange rights of any class or series of preferred stock, and to fix the number of classes or series of preferred stock, the number of shares constituting each class or series and the voting powers for each class or series.
We will describe in a prospectus supplement relating to the class or series of preferred stock being offered the specific terms of the class or series of preferred stock being offered.
Anti-Takeover Provisions of the Company’s Certificate of Incorporation and Bylaws and Delaware Law
The Company’s Certificate of Incorporation and Bylaws include a number of provisions that may have the effect of delaying, deferring or preventing another party from acquiring control of it and encouraging persons considering unsolicited tender offers or other unilateral takeover proposals to negotiate with the Company’s Board rather than pursue non-negotiated takeover attempts. These provisions include the items described below.
Filling Vacancies. Any vacancy on the Board, however occurring, including a vacancy resulting from an increase in the size of the Board, may be filled by the affirmative vote of a majority of the Board’s directors then in office, even if less than a quorum. The treatment of vacancies may have the effect of making it more difficult for stockholders to change the composition of the Board.
Advance Notice Requirements. The Company’s Bylaws establish advance notice procedures with regard to stockholder proposals relating to the nomination of candidates for election as directors or new business to be brought before meetings of the Company’s stockholders. These procedures provide that notice of stockholder proposals must be timely given in writing to the Company’s secretary prior to the meeting at which the action is to be taken. Generally, to be timely, notice must be received at the Company’s principal executive offices not later than the 45th day nor earlier than the 75th day before the one-year anniversary of the date on which the Company first mailed its proxy materials or a notice of availability of proxy materials (whichever is earlier) for the preceding year’s annual meeting. The Company’s Bylaws specify the requirements as to form and content of all stockholders’ notices. These requirements may preclude stockholders from bringing matters before the stockholders at an annual or special meeting.
Choice of Forum. The Company’s Bylaws provide that, unless consent is given in writing to an alternative forum, the Court of Chancery of the State of Delaware (or, if that court does not have jurisdiction, the federal district court for the District of Delaware) will be the sole and exclusive forum for (i) any derivative action or proceeding brought on the Company’s behalf, (ii) any action asserting a claim of a breach of a fiduciary duty owed by any of the Company’s directors, officers and employees to the Company or its stockholders, (iii) any action asserting a claim pursuant to any provision of the Delaware General Corporation Law, the Company’s Certificate of Incorporation or Bylaws, or (iv) any action asserting a claim that is governed by the internal affairs doctrine. Although the Company believes this provision is beneficial by providing increased consistency in the application of Delaware law in the types of lawsuits to which it applies, the provision may have the effect of discouraging lawsuits against the Company’s directors and officers.
Section 203 of the Delaware General Corporation Law. The Company is subject to the provisions of Section 203 of the Delaware General Corporation Law. 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 this stockholder becomes an interested stockholder, unless the business combination is approved in a prescribed manner. Under Section 203, a business combination between a corporation and an interested stockholder is prohibited unless it satisfies one of the following conditions:
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before the stockholder became interested, the Board approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder; |
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upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the Company’s voting stock outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding, shares owned by persons who are directors and also officers, and employee stock plans, in some instances, but not the outstanding voting stock owned by the interested stockholder; or |
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at or after the time the stockholder became interested, the business combination was approved by the Board 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. |
Section 203 defines a business combination to include:
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any merger or consolidation involving the Company and the interested stockholder; |
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any sale, transfer, lease, pledge or other disposition involving the interested stockholder of 10% or more of the Company’s our assets; |
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subject to exceptions, any transaction that results in the issuance or transfer by the Company of any of its stock to the interested stockholder; |
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subject to exceptions, any transaction involving the Company that has the effect of increasing the proportionate share of the stock of any of the Company’s class or series beneficially owned by the interested stockholder; and |
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the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the Company. |
In general, Section 203 defines an interested stockholder as any entity or person beneficially owning 15% or more of the outstanding voting stock of the Company and any entity or person affiliated with or controlling or controlled by the entity or person.
Undesignated Preferred Stock. The Company’s Certificate of Incorporation provides for 1,000,000 authorized shares of preferred stock. The existence of authorized but unissued shares of preferred stock may enable the Board to discourage an attempt to obtain control of the Company by means of a merger, tender offer, proxy contest or otherwise. For example, if in the due exercise of its fiduciary obligations, the Board were to determine that a takeover proposal is not in the best interests of the Company’s stockholders, the Board could cause shares of preferred stock to be issued without stockholder approval in one or more private offerings or other transactions that might dilute the voting or other rights of the proposed acquirer or insurgent stockholder or stockholder group. In this regard, the Company’s Certificate of Incorporation grants the Board broad power to establish the rights and preferences of authorized and unissued shares of preferred stock. The issuance of shares of preferred stock could decrease the amount of earnings and assets available for distribution to holders of shares of common stock. The issuance may also adversely affect the rights and powers, including voting rights, of these holders and may have the effect of delaying, deterring or preventing a change in control of the Company.
Transfer Agent
Our transfer agent is Continental Stock Transfer & Trust located at 17 Battery Street, 8th Floor, New York, New York, 10004.
Listing
Our common stock is listed on The Nasdaq Stock Market under the symbol “HQI”.
DESCRIPTION OF DEBT SECURITIES
The following description, together with the additional information we include in any applicable prospectus supplements, summarizes the material terms and provisions of the debt securities that we may offer under this prospectus. While the terms we have summarized below will apply generally to any future debt securities we may offer pursuant to this prospectus, we will describe the particular terms of any debt securities that we may offer in more detail in the applicable prospectus supplement. If we so indicate in a prospectus supplement, the terms of any debt securities offered under such prospectus supplement may differ from the terms we describe below, and to the extent the terms set forth in a prospectus supplement differ from the terms described below, the terms set forth in the prospectus supplement will control.
We may sell from time to time, in one or more offerings under this prospectus, debt securities, which may be senior or subordinated. We will issue any senior debt securities under a senior indenture that we will enter into with a trustee to be named in the senior indenture. We will issue any subordinated debt securities under a subordinated indenture, which we will enter into with a trustee to be named in the subordinated indenture. We have filed forms of these documents as exhibits to the registration statement of which this prospectus is a part. We use the term “indentures” to refer to either the senior indenture or the subordinated indenture, as applicable. The indentures will be qualified under the Trust Indenture Act of 1939, as in effect on the date of the indenture. We use the term “debenture trustee” to refer to either the trustee under the senior indenture or the trustee under the subordinated indenture, as applicable.
The following summaries of material provisions of the senior debt securities, the subordinated debt securities and the indentures are subject to, and qualified in their entirety by reference to, all the provisions of the indenture applicable to a particular series of debt securities.
General
Each indenture provides that debt securities may be issued from time to time in one or more series and may be denominated and payable in foreign currencies or units based on or relating to foreign currencies. Neither indenture limits the amount of debt securities that may be issued under that indenture, and each indenture provides that the specific terms of any series of debt securities must be included in, or determined pursuant to, an authorizing resolution and/or a supplemental indenture, if any, relating to such series.
We will describe in each prospectus supplement the following terms relating to a series of debt securities:
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title or designation; |
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the aggregate principal amount and any limit on the amount that may be issued; |
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the currency or units based on or relating to currencies in which debt securities of such series are denominated and the currency or units in which principal or interest or both will or may be payable; |
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whether we will issue the series of debt securities in global form, the terms of any global securities and who the depositary will be; |
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the maturity date and the date or dates on which principal will be payable; |
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the interest rate, which may be fixed or variable, or the method for determining the rate and the date interest will begin to accrue, the date or dates interest will be payable and the record dates for interest payment dates or the method for determining such dates; |
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whether or not the debt securities will be secured or unsecured, and the terms of any secured debt; |
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the terms of the subordination of any series of subordinated debt; |
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the place or places where payments will be payable; |
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our right, if any, to defer payment of interest and the maximum length of any such deferral period; |
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the date, if any, after which, and the price at which, we may, at our option, redeem the series of debt securities pursuant to any optional redemption provisions; |
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the date, if any, on which, and the price at which we are obligated, pursuant to any mandatory sinking fund provisions or otherwise, to redeem, or at the holder’s option to purchase, the series of debt securities; |
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whether the indenture will restrict our ability to pay dividends, or will require us to maintain any asset ratios or reserves; |
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whether we will be restricted from incurring any additional indebtedness; |
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a discussion of any material U.S. federal income tax considerations applicable to a series of debt securities; |
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the denominations in which we will issue the series of debt securities, if other than denominations of $1,000 and any integral multiple thereof; and |
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any other specific terms, preferences, rights or limitations of, or restrictions on, the debt securities. |
We may issue debt securities that provide for an amount less than their stated principal amount to be due and payable upon declaration of acceleration of their maturity pursuant to the terms of the indenture. We will provide you with information on special considerations applicable to any of these debt securities in the applicable prospectus supplement.
Conversion or Exchange Rights
We will set forth in the prospectus supplement the terms, if any, on which a series of debt securities may be convertible into or exchangeable for our common stock or our other securities. We will include provisions as to whether conversion or exchange is mandatory, at the option of the holder or at our option. We may include provisions pursuant to which the number of shares of common stock or our other securities that the holders of the series of debt securities receive would be subject to adjustment.
Consolidation, Merger or Sale; No Protection in Event of a Change of Control or Highly Leveraged Transaction
Unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities, the indentures do not contain any covenant that restricts our ability to merge or consolidate, or sell, convey, transfer or otherwise dispose of all or substantially all of our assets. However, any successor to or acquirer of such assets must assume all of our obligations under the indentures or the debt securities, as appropriate.
The debt securities will not contain any provisions that may afford holders of the debt securities protection in the event we have a change of control or in the event of a highly leveraged transaction (whether or not such transaction results in a change of control), which could adversely affect holders of debt securities.
Events of Default Under the Indenture
Unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities, the following are events of default under the indenture with respect to any series of debt securities that we may issue:
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if we fail to pay interest when due and our failure continues for 90 days and the time for payment has not been extended or deferred; |
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if we fail to pay the principal, or premium, if any, when due and the time for payment has not been extended or delayed; |
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if we fail to observe or perform any other covenant set forth in the debt securities of such series or the applicable indentures, other than a covenant specifically relating to and for the benefit of holders of another series of debt securities, and our failure continues for 90 days after we receive written notice from the debenture trustee or holders of not less than a majority in aggregate principal amount of the outstanding debt securities of the applicable series; and |
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if specified events of bankruptcy, insolvency or reorganization occur as to us. |
No event of default with respect to a particular series of debt securities (except as to certain events of bankruptcy, insolvency or reorganization) necessarily constitutes an event of default with respect to any other series of debt securities. The occurrence of an event of default may constitute an event of default under any bank credit agreements we may have in existence from time to time. In addition, the occurrence of certain events of default or an acceleration under the indenture may constitute an event of default under certain of our other indebtedness outstanding from time to time.
Unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities, if an event of default with respect to debt securities of any series at the time outstanding occurs and is continuing, then the trustee or the holders of not less than a majority in principal amount of the outstanding debt securities of that series may, by a notice in writing to us (and to the debenture trustee if given by the holders), declare to be due and payable immediately the principal (or, if the debt securities of that series are discount securities, that portion of the principal amount as may be specified in the terms of that series) of and premium and accrued and unpaid interest, if any, on all debt securities of that series. Before a judgment or decree for payment of the money due has been obtained with respect to debt securities of any series, the holders of a majority in principal amount of the outstanding debt securities of that series (or, at a meeting of holders of such series at which a quorum is present, the holders of a majority in principal amount of the debt securities of such series represented at such meeting) may rescind and annul the acceleration if all events of default, other than the non-payment of accelerated principal, premium, if any, and interest, if any, with respect to debt securities of that series, have been cured or waived as provided in the applicable indenture (including payments or deposits in respect of principal, premium or interest that had become due other than as a result of such acceleration). We refer you to the prospectus supplement relating to any series of debt securities that are discount securities for the particular provisions relating to acceleration of a portion of the principal amount of such discount securities upon the occurrence of an event of default.
Subject to the terms of the indentures, if an event of default under an indenture occurs and is continuing, the debenture trustee will be under no obligation to exercise any of its rights or powers under such indenture at the request or direction of any of the holders of the applicable series of debt securities, unless such holders have offered the debenture trustee reasonable indemnity. The holders of a majority in principal amount of the outstanding debt securities of any series will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the debenture trustee, or exercising any trust or power conferred on the debenture trustee, with respect to the debt securities of that series, provided that:
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the direction so given by the holder is not in conflict with any law or the applicable indenture; and |
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subject to its duties under the Trust Indenture Act, the debenture trustee need not take any action that might involve it in personal liability or might be unduly prejudicial to the holders not involved in the proceeding. |
A holder of the debt securities of any series will only have the right to institute a proceeding under the indenture or to appoint a receiver or trustee, or to seek other remedies if:
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the holder has given written notice to the trustee of a continuing event of default with respect to that series; |
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the holders of at least 25% in aggregate principal amount of the outstanding debt securities of that series have made written request; |
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such holders have offered to the trustee indemnity satisfactory to it against the costs, expenses and liabilities to be incurred by the trustee in compliance with the request; and |
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the trustee does not institute the proceeding, and does not receive from the holders of a majority in aggregate principal amount of the outstanding debt securities of that series other conflicting directions within 90 days after the notice, request and offer. |
We will periodically file statements with the applicable debenture trustee regarding our compliance with specified covenants in the applicable indenture.
Modification of Indenture; Waiver
Unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities, the debenture trustee and we may change the applicable indenture without the consent of any holders with respect to specific matters, including:
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to fix any ambiguity, defect or inconsistency in the indenture; and |
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to change anything that does not materially adversely affect the interests of any holder of debt securities of any series issued pursuant to such indenture. |
In addition, under the indentures, the rights of holders of a series of debt securities may be changed by us and the debenture trustee with the written consent of the holders of at least a majority in aggregate principal amount of the outstanding debt securities of each series (or, at a meeting of holders of such series at which a quorum is present, the holders of a majority in principal amount of the debt securities of such series represented at such meeting) that is affected. However, unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities, the debenture trustee and we may make the following changes only with the consent of each holder of any outstanding debt securities affected:
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extend the fixed maturity of the series of debt securities; |
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reduce the principal amount, reduce the rate of or extending the time of payment of interest, or any premium payable upon the redemption of any debt securities; |
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reduce the principal amount of discount securities payable upon acceleration of maturity; |
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make the principal of or premium or interest on any debt security payable in currency other than that stated in the debt security; or |
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reduce the percentage of debt securities, the holders of which are required to consent to any amendment or waiver. |
Except for certain specified provisions, and unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities, the holders of at least a majority in principal amount of the outstanding debt securities of any series (or, at a meeting of holders of such series at which a quorum is present, the holders of a majority in principal amount of the debt securities of such series represented at such meeting) may on behalf of the holders of all debt securities of that series waive our compliance with provisions of the indenture. Unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities, the holders of a majority in principal amount of the outstanding debt securities of any series may on behalf of the holders of all the debt securities of such series waive any past default under the indenture with respect to that series and its consequences, except a default in the payment of the principal of, premium or any interest on any debt security of that series or in respect of a covenant or provision, which cannot be modified or amended without the consent of the holder of each outstanding debt security of the series affected; provided, however, that the holders of a majority in principal amount of the outstanding debt securities of any series may rescind an acceleration and its consequences, including any related payment default that resulted from the acceleration.
Discharge
Each indenture provides that we can elect to be discharged from our obligations with respect to one or more series of debt securities, except for obligations to:
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the transfer or exchange of debt securities of the series; |
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replace stolen, lost or mutilated debt securities of the series; |
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maintain paying agencies; |
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hold monies for payment in trust; |
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compensate and indemnify the trustee; and |
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appoint any successor trustee. |
In order to exercise our rights to be discharged with respect to a series, we must deposit with the trustee money or government obligations sufficient to pay all the principal of, the premium, if any, and interest on, the debt securities of the series on the dates payments are due.
Form, Exchange, and Transfer
We will issue the debt securities of each series only in fully registered form without coupons and, unless we provide otherwise in the applicable prospectus supplement, in denominations of $1,000 and any integral multiple thereof. The indentures provide that we may issue debt securities of a series in temporary or permanent global form and as book-entry securities that will be deposited with, or on behalf of, DTC or another depositary named by us and identified in a prospectus supplement with respect to that series.
At the option of the holder, subject to the terms of the indentures and the limitations applicable to global securities described in the applicable prospectus supplement, the holder of the debt securities of any series can exchange the debt securities for other debt securities of the same series, in any authorized denomination and of like tenor and aggregate principal amount.
Subject to the terms of the indentures and the limitations applicable to global securities described in the applicable prospectus supplement, holders of the debt securities may present the debt securities for exchange or for registration of transfer, duly endorsed or with the form of transfer endorsed thereon duly executed if so required by us or the security registrar, at the office of the security registrar or at the office of any transfer agent designated by us for this purpose. Unless otherwise provided in the debt securities that the holder presents for transfer or exchange or in the applicable indenture, there will be no service charge for any registration of transfer or exchange, but we may require payment of any taxes or other governmental charges.
We will name in the applicable prospectus supplement the security registrar, and any transfer agent in addition to the security registrar, that we initially designate for any debt securities. We may at any time designate additional transfer agents or rescind the designation of any transfer agent or approve a change in the office through which any transfer agent acts, except that we will be required to maintain a transfer agent in each place of payment for the debt securities of each series.
If we elect to redeem the debt securities of any series, we will not be required to:
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issue, register the transfer of, or exchange any debt securities of that series during a period beginning at the opening of business 15 days before the day of mailing of a notice of redemption of any debt securities that may be selected for redemption and ending at the close of business on the day of the mailing; or |
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register the transfer of or exchange any debt securities so selected for redemption, in whole or in part, except the unredeemed portion of any debt securities we are redeeming in part. |
Information Concerning the Debenture Trustee
The debenture trustee, other than during the occurrence and continuance of an event of default under the applicable indenture, undertakes to perform only those duties as are specifically set forth in the applicable indenture. Upon an event of default under an indenture, the debenture trustee under such indenture must use the same degree of care as a prudent person would exercise or use in the conduct of his or her own affairs. Subject to this provision, the debenture trustee is under no obligation to exercise any of the powers given it by the indentures at the request of any holder of debt securities unless it is offered reasonable security and indemnity against the costs, expenses and liabilities that it might incur.
Payment and Paying Agents
Unless we indicate otherwise in the applicable prospectus supplement, we will make payment of the interest on any debt securities on any interest payment date to the person in whose name the debt securities, or one or more predecessor securities, are registered at the close of business on the regular record date for the interest.
We will pay the principal of and any premium and interest due on the debt securities of a particular series at the office of the paying agents designated by us, except that unless we otherwise indicate in the applicable prospectus supplement, will we make interest payments by check which we will mail to the holder. Unless we otherwise indicate in the applicable prospectus supplement, we will designate the corporate trust office of the debenture trustee as our sole paying agent for payments with respect to debt securities of each series. We will name in the applicable prospectus supplement any other paying agents that we initially designate for the debt securities of a particular series. We will maintain a paying agent in each place of payment for the debt securities of a particular series.
All money we pay to a paying agent or the debenture trustee for the payment of the principal of or any premium or interest on any debt securities which remains unclaimed at the end of two years after such principal, premium or interest has become due and payable will be repaid to us, and the holder of the security thereafter may look only to us for payment thereof.
Governing Law
The indentures and the debt securities will be governed by and construed in accordance with the laws of the State of New York, except to the extent that the Trust Indenture Act is applicable.
Subordination of Subordinated Debt Securities
Our obligations pursuant to any subordinated debt securities will be unsecured and will be subordinate and junior in priority of payment to certain of our other indebtedness to the extent described in a prospectus supplement. The subordinated indenture does not limit the amount of senior indebtedness we may incur. It also does not limit us from issuing any other secured or unsecured debt.
DESCRIPTION OF WARRANTS
We may issue warrants for the purchase of shares of our common stock or preferred stock. We may issue warrants independently or together with other securities, and the warrants may be attached to or separate from any offered securities. Each series of warrants will be issued under a separate warrant agreement to be entered into between us and the investors or a warrant agent.
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, if any, including a form of warrant certificate, that describes the terms of the particular series of warrants we are offering. The following summary of material provisions of the warrants and 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 a particular series of warrants. The terms of any warrants offered under a prospectus supplement may differ from the terms described below. We urge you to read the applicable prospectus supplement and any related free writing prospectus, as well as the complete warrant agreements and warrant certificates that contain the terms of the warrants.
The particular terms of any issue of warrants will be described in the prospectus supplement relating to the issue. Those terms may include:
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the number of shares of common stock or preferred stock purchasable upon the exercise of warrants to purchase such shares and the price at which such number of shares may be purchased upon such exercise; |
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the designation, stated value and terms (including, without limitation, liquidation, dividend, conversion and voting rights) of the series of preferred stock purchasable upon exercise of warrants to purchase preferred stock; |
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the date, if any, on and after which the warrants and the related preferred stock or common stock will be separately transferable; |
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the terms of any rights to redeem or call the warrants; |
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the date on which the right to exercise the warrants will commence and the date on which the right will expire; |
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a discussion of certain material United States Federal income tax consequences applicable to the warrants; and |
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any additional terms of the warrants, including terms, procedures, and limitations relating to the exchange, exercise and settlement of the warrants. |
Holders of equity warrants will not be entitled:
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to vote, consent or receive dividends; |
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receive notice as shareholders with respect to any meeting of shareholders for the election of our directors or any other matter; or |
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exercise any rights as shareholders. |
Each warrant will entitle its holder to purchase the number of shares of preferred stock or common stock at the exercise price set forth in, or calculable as set forth in, the applicable prospectus supplement. Unless we otherwise specify 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.
A holder of warrant certificates may exchange them for new warrant certificates of different denominations, present them for registration of transfer and exercise them at the corporate trust office of the warrant agent or any other office indicated in the applicable prospectus supplement. Until any warrants to purchase common stock or preferred stock are exercised, the holders of the warrants will not have any rights of holders of the underlying common stock or preferred stock, including any rights to receive dividends or payments upon any liquidation, dissolution or winding up on the common stock or preferred stock, if any.
DESCRIPTION OF UNITS
We may issue units consisting of any combination of common stock, preferred stock, debt securities and warrants offered under this prospectus in one or more series. We may evidence each series of units by unit certificates that we will issue under a separate agreement. We may enter into unit agreements with a unit agent. Each unit agent will be a bank or trust company that we select. We will indicate the name and address of the unit agent in the applicable prospectus supplement relating to a particular series of units.
The following description, together with the additional information included in any applicable prospectus supplement, summarizes the general features of the units that we may offer under this prospectus. You should read any prospectus supplement and any free writing prospectus that we may authorize to be provided to you related to the series of units being offered, as well as the complete unit agreements that contain the terms of the units. Specific unit agreements will contain additional important terms and provisions and we will file as an exhibit to the registration statement of which this prospectus is a part, or will incorporate by reference from another report that we file with the SEC, the form of each unit agreement relating to units offered under this prospectus.
If we offer any units, certain terms of that series of units will be described in the applicable prospectus supplement, including, without limitation, the following, as applicable:
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the title of the series of units; |
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identification and description of the separate constituent securities comprising the units; |
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the price or prices at which the units will be issued; |
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the date, if any, on and after which the constituent securities comprising the units will be separately transferable; |
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a discussion of certain material United States federal income tax considerations applicable to the units; and |
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any other terms of the units and their constituent securities. |
DESCRIPTION OF SUBSCRIPTION RIGHTS
The following is a summary of the general terms of the subscription rights to purchase common stock or other securities that we may offer to shareholders using this prospectus. This summary does not purport to be complete and is subject to and qualified entirely by reference to the applicable forms of subscription agent agreement and subscription certificate for a full understanding of all terms of any series of subscription rights.
Subscription rights may be issued independently or together with any other security and may or may not be transferable. As part of any subscription rights offering, we may enter into a standby underwriting or other arrangement under which the underwriters or any other person would purchase any securities that are not purchased in such subscription rights offering. If we issue subscription rights, they will be governed by a separate subscription agent agreement that we will sign with a bank or trust company, as rights agent, that will be named in an applicable prospectus supplement relating to such subscription rights. The rights agent will act solely as our agent and will not assume any obligation to any holders of subscription rights certificates or beneficial owners of subscription rights.
In general, a subscription right entitles the holder to purchase for cash a specific number of shares of common stock or other securities at a specified exercise price. The rights are normally issued to shareholders as of a specific record date, may be exercised only for a limited period of time and become void following the expiration of such period. In connection with a rights offering to our shareholders, we will distribute certificates evidencing the rights and a prospectus supplement to our shareholders on or about the record date that we set for receiving rights in such rights offering. The prospectus supplement will describe, among other things:
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the record date for shareholders entitled to receive the subscription rights; |
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the number of shares of common stock or other securities that may be purchased upon exercise of each subscription right; |
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the exercise price of the subscription rights; |
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whether the subscription rights are transferable; |
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the period during which the subscription rights may be exercised and when they will expire; |
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the steps required to exercise the subscription rights; |
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whether the subscription rights include “oversubscription rights” so that the holder may purchase more securities if other holders do not purchase their full allotments; |
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whether we intend to sell the shares of common stock or other securities that are not purchased in the rights offering to an underwriter or other purchaser under a contractual "standby" commitment or other arrangement; and |
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a discussion of certain material U.S. federal income tax considerations. |
If fewer than all of the subscription rights issued in any rights offering are exercised, we may offer any unsubscribed securities directly to persons other than shareholders, to or through agents, underwriters or dealers or through a combination of such methods, including pursuant to standby arrangements, as described in an applicable prospectus supplement relating to such subscription rights. After the close of business on the expiration date of a subscription rights offering, all unexercised subscription rights will become void.
Upon receipt of payment and a subscription certificate properly completed and duly executed at the corporate trust office of the rights agent or any other office indicated in the prospectus supplement, we will, as soon as practicable, forward the securities purchasable upon such exercise. If less than all of the rights represented by such subscription certificate are exercised, a new subscription certificate will be issued for the remaining rights. If we so indicate in the applicable prospectus supplement, holders of the rights may surrender securities as all or part of the exercise price for rights.
Prior to exercising their rights, holders of rights will not have any of the rights of holders of the securities purchasable upon subscription, including, in the case of rights 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 any voting rights.
PLAN OF DISTRIBUTION
We may sell the securities offered through this prospectus (i) to or through underwriters or dealers, (ii) directly to purchasers, including our affiliates, (iii) through agents, or (iv) through a combination of any of these methods. The securities may be distributed at a fixed price or prices, which may be changed, market prices prevailing at the time of sale, prices related to the prevailing market prices, or negotiated prices.
We may also sell the common stock covered by this registration statement in an “at the market offering” as defined in Rule 415(a)(4) under the Securities Act. Such offering may be made into an existing trading market for such securities in transactions at other than a fixed price either:
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on or through the facilities of The Nasdaq Stock Market or any other securities exchange or quotation or trading service on which such securities may be listed, quoted, or traded at the time of sale; and/or |
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to or through a market maker otherwise than on The Nasdaq Stock Market or such other securities exchanges or quotation or trading services. |
Such at the market offerings, if any, may be conducted by underwriters acting as principal or agent.
A prospectus supplement or supplements (and any related free writing prospectus that we may authorize to be provided to you) will describe the terms of the offering and will include the following information, to the extent applicable:
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the terms of the offering; |
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the names of any underwriters or agents; |
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the name or names of any managing underwriter or underwriters; |
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the purchase price of the securities; |
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any over-allotment options under which underwriters may purchase additional securities from us; |
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the net proceeds from the sale of the securities; |
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any delayed delivery arrangements; |
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any underwriting discounts, commissions and other items constituting underwriters’ compensation; |
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any initial public offering price; |
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any discounts or concessions allowed or re-allowed or paid to dealers; |
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any commissions paid to agents; and |
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any securities exchange or market on which the securities may be listed. |
Sale through Underwriters or Dealers
Only underwriters named in a prospectus supplement are underwriters of the securities offered by the prospectus supplement.
If underwriters are used in the sale, the underwriters will acquire the securities for their own account, including through underwriting, purchase, security lending or repurchase agreements with us. The underwriters may resell the securities from time to time in one or more transactions, including negotiated transactions. Underwriters may sell the securities in order to facilitate transactions in any of our other securities (described in this prospectus or otherwise), including other public or private transactions and short sales. Underwriters may offer securities to the public either through underwriting syndicates represented by one or more managing underwriters or directly by one or more firms acting as underwriters. Unless otherwise indicated in the prospectus supplement, the obligations of the underwriters to purchase the securities will be subject to certain conditions, and the underwriters will be obligated to purchase all the offered securities if they purchase any of them. The underwriters may change from time to time any initial public offering price and any discounts or concessions allowed or re-allowed or paid to dealers.
If dealers are used in the sale of securities offered through this prospectus, we will sell the securities to them as principals. They may then resell those securities to the public at varying prices determined by the dealers at the time of resale. The prospectus supplement will include the names of the dealers and the terms of the transaction.
Direct Sales and Sales through Agents
We may sell the securities offered through this prospectus directly. In this case, no underwriters or agents would be involved. Such securities may also be sold through agents designated from time to time. The prospectus supplement will name any agent involved in the offer or sale of the offered securities and will describe any commissions payable to the agent. Unless otherwise indicated in the prospectus supplement, any agent will agree to use its reasonable best efforts to solicit purchases for the period of its appointment.
We may sell the securities directly to institutional investors or others who may be deemed to be underwriters within the meaning of the Securities Act with respect to any sale of those securities. The terms of any such sales will be described in the prospectus supplement.
Delayed Delivery Contracts
If the prospectus supplement indicates, we may authorize agents, underwriters, or dealers to solicit offers from certain types of institutions to purchase securities at the public offering price under delayed delivery contracts. These contracts would provide for payment and delivery on a specified date in the future. The contracts would be subject only to those conditions described in the prospectus supplement. The applicable prospectus supplement will describe the commission payable for solicitation of those contracts.
Continuous Offering Program
Without limiting the generality of the foregoing, we may enter into a continuous offering program equity distribution agreement with a broker-dealer, under which we may offer and sell shares of our common stock from time to time through a broker-dealer as our sales agent. If we enter into such a program, sales of the shares of common stock, if any, will be made by means of ordinary brokers’ transactions on the Nasdaq Stock Market or other market on which our shares may then trade at market prices, block transactions and such other transactions as agreed upon by us and the broker-dealer. Under the terms of such a program, we also may sell shares of common stock to the broker-dealer, as principal for its own account at a price agreed upon at the time of sale. If we sell shares of common stock to such broker-dealer as principal, we will enter into a separate terms agreement with such broker-dealer, and we will describe this agreement in a separate prospectus supplement or pricing supplement.
Market Making, Stabilization, and Other Transactions
Our common stock is listed on Nasdaq. Any shares of common stock sold pursuant to an applicable prospectus supplement will be eligible for listing and trading on Nasdaq, subject to official notice of issuance. Unless any applicable prospectus supplement states otherwise, each other class or series of securities issued will be a new issue and will have no established trading market. We may elect to list any other class or series of securities on an exchange, but we are not currently obligated to do so. Any underwriters that we use in the sale of offered securities may make a market in the securities but may discontinue market making at any time without notice. Therefore, we cannot assure you that the securities will have a liquid trading market.
Any underwriter may also engage in stabilizing transactions, syndicate covering transactions, and penalty bids in accordance with Regulation M under the Exchange Act. Stabilizing transactions involve bids to purchase the underlying security in the open market for the purpose of pegging, fixing, or maintaining the price of the securities. Syndicate covering transactions involve purchases of the securities in the open market after the distribution has been completed in order to cover syndicate short positions.
Penalty bids permit the underwriters to reclaim a selling concession from a syndicate member when the securities originally sold by the syndicate member are purchased in a syndicate covering transaction to cover syndicate short positions. Stabilizing transactions, syndicate covering transactions, and penalty bids may cause the price of the securities to be higher than it would be in the absence of the transactions. The underwriters may, if they commence these transactions, discontinue them at any time.
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. Any such transactions, if commenced, may be discontinued at any time. We make no representation or prediction as to the direction or magnitude of any effect that the transactions described above if implemented, may have on the price of our securities.
We, the underwriters or other agents may engage in derivative transactions involving the securities. These derivatives may consist of short sales for hedging purposes and any other hedging activities. The underwriters or agents may acquire a long or short position in the securities, hold or resell securities acquired and purchase options or futures on the securities and other derivative instruments with returns linked to or related to changes in the price of the securities. In order to facilitate these derivative transactions, we may enter into security lending or repurchase agreements with the underwriters or agents. The underwriters or agents may affect the derivative transactions through sales of the securities to the public, including short sales, or by lending the securities in order to facilitate short sale transactions by others.
The underwriters or agents may also use the securities purchased or borrowed from us or others (or, in the case of derivatives, securities received from us in settlement of those derivatives) to directly or indirectly settle sales of the securities or close out any related open borrowings of the securities arising from the distribution of our securities by the underwriters.
Electronic Auctions
We also may make sales through the Internet or through other electronic means. Since we may from time to time elect to offer securities directly to the public, with or without the involvement of agents, underwriters or dealers, utilizing the Internet or other forms of electronic bidding or ordering systems for the pricing and allocation of the securities, you will want to pay particular attention to the description of that system we will provide in an applicable prospectus supplement.
The electronic system may allow bidders to directly participate, through electronic access to an auction site, by submitting conditional offers to buy that are subject to acceptance by us, and which may directly affect the price or other terms and conditions at which the securities are sold. These bidding or ordering systems may present to each bidder, on a so-called “real-time” basis, relevant information to assist in making a bid, such as the clearing spread at which the offering would be sold, based on the bids submitted, and whether a bidder’s individual bids would be accepted, prorated or rejected. Of course, many pricing methods can and may also be used.
Upon completion of the electronic auction process, securities will be allocated based on prices bid, terms of the bid, or other factors. The final offering price at which securities would be sold and the allocation of securities among bidders would be based in whole or in part on the results of the Internet or other electronic bidding process or auction.
General Information
Agents, underwriters, and dealers may be entitled, under agreements entered into with us, to indemnification by us against certain liabilities, including liabilities under the Securities Act. Our agents, underwriters, and dealers, or their affiliates, may be customers of, engage in transactions with or perform services for us, in the ordinary course of business.
LEGAL MATTERS
The validity of the securities offered hereby will be passed upon for us by Hill, Ward & Henderson, P.A., Tampa, Florida. Additional legal matters may be passed upon for us or any underwriters, dealers, or agents, by counsel that we will name in the applicable prospectus supplement.
EXPERTS
Plante & Moran, PLLC, an independent registered public accounting firm, has audited our financial statements as of and for the years ended December 31, 2021 and December 31, 2020, included in our Annual Report on Form 10-K for the year ended December 31, 2021, as set forth in its report, which is incorporated by reference in this prospectus and elsewhere in the registration statement. Our financial statements are incorporated by reference in reliance on Plante & Moran, PLLC’s report, given on their authority as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the SEC a registration statement on Form S-3 under the Securities Act with respect to the shares of our common stock being registered by this prospectus. This prospectus is a part of, and does not contain all of the information set forth in, the registration statement and the exhibits and schedules to the registration statement, portions of which have been omitted as permitted by the rules and regulations of the SEC. For further information with respect to us and our common stock, please refer to the registration statement, including its exhibits and schedules. Statements made in this prospectus relating to any contract or other document filed as an exhibit to the registration statement include the material terms of such contract or other document. However, such statements are not necessarily complete, and you should refer to the exhibits attached to or incorporated by reference in the registration statement for copies of the actual contract or document.
Because we are subject to the information and reporting requirements of the Exchange Act, we file periodic reports, proxy statements, and other information with the SEC. Our SEC filings are available to the public over the Internet at the SEC’s website at http://www.sec.gov. Those filings are also available to the public on, or accessible through, our website under the heading “Invest” at www.hirequest.com. You may review a copy of the registration statement by calling the SEC at 1-800-SEC-0330 as well as on the Internet website maintained by the SEC at www.sec.gov. Information contained on any website referenced in this prospectus is not incorporated by reference in this prospectus.
You should rely only on the information contained in this prospectus or to which this prospectus has referred you. We have not authorized any person to provide you with different information or to make any representation not contained in this prospectus.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
We “incorporate by reference” certain information into this prospectus, which means that we disclose important information to you by referring you to another document filed separately with the SEC. The information incorporated by reference is deemed to be part of this prospectus, and relying on the Fixing America’s Surface Transportation Act, or the FAST Act, as a smaller reporting company, subsequent information that we file with the SEC will automatically update and supersede that information. Any statement contained in a previously filed document incorporated by reference will be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained in this prospectus modifies or replaces that statement.
We incorporate by reference our documents listed below and any future filings made by us with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination of the offering, including documents we may file with the SEC after the date of the initial registration statement and prior to effectiveness of the registration statement. We are not, however, incorporating by reference any documents or portions thereof, whether specifically listed below or filed in the future, that are not deemed “filed” with the SEC, including any information furnished pursuant to Items 2.02 or 7.01 of Form 8-K or related exhibits furnished pursuant to Item 9.01 of Form 8-K. This prospectus and any amendments or supplements thereto incorporate by reference the documents set forth below that have previously been filed with the SEC:
|
● |
Our Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC on March 15, 2022, including the portions of our Definitive Proxy Statement on Schedule 14A filed with the SEC on April 28, 2022 and incorporated by reference therein; |
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● |
Our Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 filed with the SEC on May 10, 2022; |
|
● |
The description of our common stock contained in our Forms 8-A filed with the SEC, including all amendments and reports filed for the purpose of updating such description, including Exhibit 4.2 to our Annual Report on Form 10-K for the year ended December 31, 2020, as filed with the SEC on March 25, 2021. |
You should rely only on the information incorporated by reference or provided in this prospectus or any prospectus supplement. We have not authorized anyone else to provide you with any information. You should not assume that the information incorporated by reference or provided in this prospectus is accurate as of any date other than the date on the front of each document. Any stockholder, including any beneficial owner may request, in writing or orally, a free copy of any or all of the reports or documents incorporated by reference in this prospectus (other than exhibits, unless they are specifically incorporated by reference in the documents) by writing or telephoning us at the following address:
John D. McAnnar
Chief Legal Officer
HireQuest, Inc.
111 Springhall Drive
Goose Creek, SC 29445
Telephone: (843) 723-7400
We also maintain a website at www.hirequest.com where incorporated reports or other documents filed with the SEC may be accessed. We have not incorporated by reference into this prospectus the information contained in, or that can be accessed through, our website, and you should not consider it to be part of this prospectus. For other ways to obtain a copy of these filings, please refer to “Where You Can Find More Information” above.
$100,000,000
HireQuest, Inc.
Common Stock
Preferred Stock
Debt Securities
Warrants
Units
Rights
PROSPECTUS
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
|
ITEM 14. |
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION |
The following table sets forth all estimated costs and expenses, other than underwriting discounts, commissions, and expense allowances, payable by the issuer in connection with the maximum offering for the securities included in this registration statement:
|
Expenses |
Amount |
|||
|
SEC Registration Fee |
$ | 9,270 | ||
|
Legal Fees* |
* | |||
|
Accounting and Audit Fees* |
* | |||
|
Electronic Filing and Printing* |
* | |||
|
Transfer Agent* |
* | |||
|
Total |
* | |||
|
* |
These fees and expenses depend on the types of securities offered and the number of offerings, and accordingly cannot be estimated at this time. |
|
ITEM 15. |
INDEMNIFICATION OF DIRECTORS AND OFFICERS |
Section 102 of the General Corporation Law of the State of Delaware (“DGCL”) permits a corporation to eliminate the personal liability of directors of a corporation to the corporation or its stockholders for monetary damages for a breach of fiduciary duty as a director, except where the director breached his or her duty of loyalty, failed to act in good faith, engaged in intentional misconduct or knowingly violated a law, authorized the payment of a dividend or approved a stock repurchase in violation of Delaware corporate law or obtained an improper personal benefit. Our bylaws state that none of our directors shall be personally liable to us or our stockholders for monetary damages for any breach of fiduciary duty as a director, notwithstanding any provision of law imposing such liability, except to the extent that the General Corporation Law of the State of Delaware prohibits the elimination or limitation of liability of directors for breaches of fiduciary duty.
Section 145 of the DGCL provides that a corporation has the power to indemnify a director, officer, employee, or agent of the corporation, or a person serving at the request of the corporation for another corporation, partnership, joint venture, trust or other enterprise in related capacities, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with an action, suit or proceeding to which he or she was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding by reason of such position, if such person acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation, and, in any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful, except that, in the case of actions brought by or in the right of the corporation, no indemnification shall be made with respect to any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or other adjudicating court determines that, despite the adjudication of liability but in view of all of the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper.
The registrant’s certificate of incorporation provides that it shall indemnify, to the fullest extent permitted by applicable law, any of its directors or officers 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 (a “Proceeding”) by reason of the fact that he or she is or was a director, officer, employee or agent of the registrant or is or was serving at the request of the registrant 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, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with any such Proceeding. We are required to indemnify a person in connection with a Proceeding initiated by such person only if the Proceeding was authorized by the Board of Directors. We have the power to indemnify, to the extent permitted by applicable law, any employee or agent of the registrant who was or is a party or is threatened to be made a party to any Proceeding by reason of the fact that he or she is or was a director, officer, employee or agent of the registrant or is or was serving at the request of the registrant 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, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with any such Proceeding.
Article 8 of the registrant’s bylaws provides that it will indemnify, to the fullest extent authorized by the DGCL, each person who was or is made a party or is threatened to be made a party to or is involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he or she is or was a director or officer of the registrant, if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the registrant, and, with respect to any criminal action or proceeding, had no reasonable cause to believe such person’s conduct was unlawful.
In addition to the above, the registrant has entered into indemnification agreements with each of its directors and officers. These indemnification agreements provide the registrant’s directors and officers with the same indemnification and advancement of expenses as described above and provide that its directors and officers will be indemnified to the fullest extent authorized by any future Delaware law that expands the permissible scope of indemnification. The registrant also has directors’ and officers’ liability insurance, which provides coverage against certain liabilities that may be incurred by the registrant’s directors and officers in their capacities as directors and officers of the registrant.
Disclosure of SEC Position on Indemnification for Securities Act Liabilities
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling the registrant, the registrant has been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.
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ITEM 16. |
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES |
|
(a) |
Exhibits |
The exhibit index attached hereto is incorporated herein by reference.
|
(b) |
Financial Statement Schedules |
All schedules have been omitted because the information required to be set forth in the schedules is either not applicable or is shown in the financial statements or notes thereto.
|
ITEM 17. |
UNDERTAKINGS |
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i) to include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. 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 a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and
(iii) to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;
provided, however, that paragraphs (1)(i), (1)(ii) and (1)(iii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.
(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(4) That, for the purpose of determining liability under the Securities Act of 1933 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 of 1933 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 of 1933 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 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 of 1933, each filing of the registrant’s annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(8) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities 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 Securities Act of 1933 and will be governed by the final adjudication of such issue.
INDEX TO EXHIBITS
|
Exhibit No. |
Description |
|
1.1* |
Form of Underwriting Agreement |
|
3.1 |
|
|
3.2 |
|
|
4.1 |
|
|
4.2* |
Form of Preferred Stock Certificate. |
|
4.3* |
Form of Certificate of Designations with respect to any Preferred Stock issued hereunder. |
|
4.4* |
Form of Senior Debt Indenture. |
|
4.5* |
Form of Subordinated Debt Indenture. |
|
4.6* |
Form of Warrant Agreement and Warrant Certificate. |
|
4.7* |
Form of Unit Agreement and Unit Certificate. |
|
5.1 |
|
|
23.1 |
Consent of Hill, Ward & Henderson, P.A. (included in Exhibit 5.1 filed herewith). |
|
23.2 |
|
|
24.1 |
Power of Attorney (included on the signature page to this Registration Statement). |
|
25.1** |
Statement of Eligibility of Trustee under the Indenture |
|
107 |
*To be filed by amendment or incorporated by reference in connection with the offering of the securities, if applicable.
**To be filed in accordance with the requirements of Section 305(b)(2) of the Trust Indenture Act of 1939, as amended, and the applicable rules thereunder.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in Goose Creek, South Carolina on the 25th day of May, 2022.
HIREQUEST, INC.
| /s/Richard F. Hermanns | Richard F. Hermanns | May 25, 2022 |
| Signature | Printed Name | Date |
| President, Chief Executive Officer, Chairman | ||
| /s/David S. Burnett | David S. Burnett | May 25, 2022 |
| Signature | Printed Name | Date |
| Chief Financial Officer |
We, the undersigned officers and directors of HIREQUEST, INC., hereby severally constitute and appoint Richard F. Hermanns, our true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for us and in our stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this Registration Statement and all documents relating thereto, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act and thing necessary or advisable to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent or his substitute or substitutes, may lawfully do or cause to be done by virtue thereof.
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.
| /s/Richard F. Hermanns | Richard F. Hermanns | May 25, 2022 |
| Signature | Printed Name | Date |
| President, Chief Executive Officer, Chairman | ||
| (Principal Executive Officer) | ||
| /s/David S. Burnett | David S. Burnett | May 25, 2022 |
| Signature | Printed Name | Date |
| Chief Financial Officer | ||
| (Principal Financial Officer and Principal Accounting Officer) | ||
| /s/ Jack Olmstead | Jack Olmstead | May 25, 2022 |
| Signature | Printed Name | Date |
| Director | ||
| /s/ R. Rimmy Malhotra | R. Rimmy Malhotra | May 25, 2022 |
| Signature | Printed Name | Date |
| Director | ||
| /s/ Kathleen Shanahan | Kathleen Shanahan | May 25, 2022 |
| Signature | Printed Name | Date |
| Director | ||
| /s/ Lawrence Hagenbuch | Lawrence Hagenbuch | May 25, 2022 |
| Signature | Printed Name | Date |
| Director | ||
| /s/ Edward Jackson | Edward Jackson | May 25, 2022 |
| Signature | Printed Name | Date |
| Director | ||
Exhibit 5.1
May 25, 2022
HireQuest, Inc.
111 Springhall Drive
Goose Creek, South Carolina 29445
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
We have acted as counsel to HireQuest, Inc., a Delaware corporation (the “Company”), in connection with the preparation and filing with the Securities and Exchange Commission (the “Commission”) of a Registration Statement on Form S-3 (as the same may be amended from time to time, the “Registration Statement”), under the Securities Act of 1933, as amended (the “Securities Act”), relating to the offering and sale from time to time by the Company, pursuant to Rule 415 under the Securities Act, at an aggregate offering price of $100,000,000, of (i) shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”), (ii) shares of the Company’s preferred stock, par value $0.001 per share (the “Preferred Stock”), (iii) debt securities of the Company, in one or more series (the “Debt Securities”), which may be issued pursuant to a debt indenture (the “Indenture”), to be dated on or about the date of the first issuance of Debt Securities thereunder, by and between a trustee to be selected by the Company (the “Trustee”) and the Company, (iv) warrants to purchase Common Stock, Preferred Stock, or any combination thereof (the “Warrants”), (v) units consisting of one or more of the Company’s Common Stock, Preferred Stock, Debt Securities or Warrants or any combination thereof, and (iv) subscription rights to purchase Common Stock, Preferred Stock, Debt Securities, Warrants, Units or any combination thereof (“Subscription Rights”, and together with the Common Stock, the Preferred Stock, the Debt Securities, the Warrants and the Units, the “Securities”). The offering of the Securities will be as set forth in the prospectus forming a part of the Registration Statement (the “Prospectus”), as supplemented by one or more supplements to the Prospectus (each supplement, a “Prospectus Supplement”).
This opinion is being furnished in accordance with the requirements of Item 601(b)(5) of Regulation S-K under the Securities Act. This opinion letter is limited to the matters expressly stated herein and no opinions are to be inferred or may be implied beyond the opinion expressly so stated.
In connection with this opinion letter, we have examined and are familiar with (i) the Registration Statement, including the exhibits constituting a part of the Registration Statement; (ii) the certificate of incorporation and the bylaws of the Company; and (iii) such other documents and records as we have deemed necessary to enable us to render this opinion.
HireQuest, Inc.
May 25, 2022
Page 2 of 7
In making the aforesaid examinations, we have assumed that (a) all documents furnished to us by the Company are accurate and complete; (b) all signatures on documents examined by us are genuine; (c) all documents submitted to us as originals, and the originals of all documents submitted to us as copies are authentic; (d) all documents submitted to us as copies conform with the originals of those documents; (e) each party that has executed a document reviewed by us has the legal capacity to execute and deliver such document; and (f) the representations of officers and employees provided to us in connection with this opinion are correct as to questions of fact.
We have furthermore assumed that (a) the Registration Statement filed by the Company with the Commission is identical to the form of the document that we have reviewed; (b) the Registration Statement, and any amendments thereto, will have become effective (and will remain effective at the time of issuance of any Securities thereunder); (c) any amendment to the Registration Statement subsequent to the initial effective date will conform to applicable law and the relevant rules and regulations of the Commission; (d) a Prospectus Supplement describing each class and/or series of Securities offered pursuant to the Registration Statement, to the extent required by applicable law and relevant rules and regulations of the Commission, will be timely filed with the Commission, and comply with all applicable laws; (e) the Company has timely filed all necessary reports pursuant to the Securities Exchange Act of 1934, as amended, which are incorporated into the Registration Statement by reference; (f) the Company will issue and sell the Securities in compliance with applicable federal and state securities laws and in accordance with the manner described in the Registration Statement, the Prospectus, and the applicable Prospectus Supplement; (g) any Securities issuable upon conversion, exercise or exchange of any Securities being offered or issued will be duly authorized and, if appropriate, reserved for issuance upon such conversion, exercise or exchange; (h) the terms of the Securities will have been duly established so as not to violate any applicable law, are in conformity with the Company’s then-operative certificate of incorporation (the “Certificate of Incorporation”) and bylaws (the “Bylaws”), do not result in a default under or breach of any agreement or instrument binding upon the Company, and comply with any applicable requirement or restriction imposed by any court or governmental or regulatory body having jurisdiction over the Company; and (i) if issued in certificated form, certificates representing the Securities will be duly executed and delivered and, to the extent required by any applicable agreement, duly authenticated and countersigned, and if issued in book-entry form, the Securities will be duly registered to the extent required by any applicable agreement.
With respect to our opinion as to the Common Stock, we have assumed that, at the time of issuance and sale, a sufficient number of shares of Common Stock are authorized and available for issuance and that the consideration for the issuance and sale of the Common Stock (or Preferred Stock, Debt Securities, Warrants, Units or Subscription Rights convertible into, exchangeable for or exercisable for, Common Stock) is in an amount that is not less than the par value of the Common Stock.
With respect to our opinion as to the Preferred Stock, we have assumed that, at the time of issuance and sale, a sufficient number of shares of Preferred Stock are authorized, designated and available for issuance and that the consideration for the issuance and sale of the Preferred Stock (or Debt Securities, Warrants, Units or Subscription Rights convertible into, exchangeable for or exercisable for, Preferred Stock) is in an amount that is not less than the par value of the Preferred Stock.
HireQuest, Inc.
May 25, 2022
Page 3 of 7
We have also assumed that the Indenture will be executed in the applicable form filed as an exhibit to the Registration Statement, and that any supplemental indenture, warrant agreement, unit agreement or rights agreement will be executed in the forms incorporated by reference in the Registration Statement. We have also assumed that (i) with respect to Securities issuable upon conversion of any convertible Preferred Stock, such convertible Preferred Stock will be validly issued, fully paid and nonassessable; (ii) with respect to any Securities issuable upon conversion, exchange or exercise of any Debt Securities, Warrants, Units or Subscription Rights, such Debt Securities, Warrants, Units or Subscription Rights constitute valid and legally binding obligations of the Company, enforceable against the Company in accordance with their terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting creditors’ rights generally, and by general equitable principles (regardless of whether such enforceability is considered in a proceeding at law or in equity) (the “Enforceability Limitations”), (iii) with respect to any Debt Securities, the Indenture is and will be a valid and legally binding obligation of the Trustee, enforceable against the Trustee in accordance with its terms, subject to the Enforceability Limitations, and (iv) with respect to any Warrants, Units or Subscription Rights, any applicable warrant agreement, unit agreement or rights agreement will be a valid and legally binding obligation of the Warrant Agent, Unit Agent or Rights Agent (each as defined below), respectively, enforceable against such agent in accordance with its respective terms, subject to the Enforceability Limitations.
Based upon and subject to the foregoing, and subject to the further assumptions and qualifications set forth below, it is our opinion that:
1. With respect to any shares of Common Stock to be offered by the Company pursuant to the Registration Statement, including shares of Common Stock issuable upon conversion, exchange or exercise of any other Securities (the “Offered Common Stock”), provided that: (i) the issuance of the Offered Common Stock has been duly authorized by all necessary corporate action on the part of the Company; (ii) the Offered Common Stock has been duly delivered to the purchasers thereof in accordance with, and against payment therefor specified in, any applicable duly authorized, executed and delivered purchase, underwriting or similar agreement and as contemplated in the Registration Statement, the Prospectus and the related Prospectus Supplement(s); and (iii), if the Offered Common Stock is being issued upon conversion, exchange or exercise of any other Securities, the Offered Common Stock has been duly delivered to the purchasers thereof in accordance with, and against payment therefor specified in, the applicable duly authorized, executed and delivered agreements, instruments or documents, then the Offered Common Stock will be validly issued, fully paid and nonassessable.
HireQuest, Inc.
May 25, 2022
Page 4 of 7
2. With respect to the shares of any series of Preferred Stock to be offered by the Company pursuant to the Registration Statement, including shares of Preferred Stock issuable upon conversion, exchange or exercise of any other Securities (the “Offered Preferred Stock”), provided that: (i) the terms and issuance of the Offered Preferred Stock have been duly authorized by all necessary corporate action on the part of the Company, including the adoption of any required certificate of amendment to the Certificate of Incorporation for any shares of Offered Preferred Stock offered under the Registration Statement (the “Certificate of Designation”) in accordance with the applicable provisions of the Delaware General Corporation Law (the “DGCL”); (ii) the filing of any required Certificate of Designation with the Secretary of State of the State of Delaware has occurred; (iii) the Offered Preferred Stock has been duly delivered to the purchasers thereof in accordance with, and against payment therefor specified in, any applicable duly authorized, executed and delivered purchase, underwriting or similar agreement and as contemplated in the Registration Statement, the Prospectus and the related Prospectus Supplement(s); and (iv), if the Offered Preferred Stock is being issued upon conversion, exchange or exercise of any other Securities, the Offered Preferred Stock has been duly delivered to the purchasers thereof in accordance with, and against payment therefor specified in, the applicable duly authorized, executed and delivered agreements, instruments or documents, then the Offered Preferred Stock will be validly issued, fully paid and nonassessable.
3. With respect to any series of the Debt Securities to be issued under the Indenture and to be offered by the Company pursuant to the Registration Statement, including Debt Securities issuable upon conversion, exchange or exercise of any other Securities (the “Offered Debt Securities”), provided that: (i) the Indenture has been duly and validly authorized by the Company and the Trustee by all necessary corporate action; (ii) the Indenture has been duly executed and delivered by the Company and the Trustee and has been qualified under the Trust Indenture Act of 1939, as amended; (iii) the issuance of the Offered Debt Securities has been duly authorized by all necessary corporate action on the part of the Company; (iv) the terms of the Offered Debt Securities and of their issuance and sale, including as to any Securities to be issued on the conversion or exchange thereof, have been duly authorized by the Company by all necessary corporate action and have been duly established in conformity with the Indenture; (v) the notes representing the Offered Debt Securities have been duly executed and delivered by the Company and authenticated by the Trustee in accordance with, and against payment therefor specified in, the Indenture and any applicable duly authorized, executed and delivered purchase, underwriting or similar agreement and as contemplated in the Registration Statement, the Prospectus and the related Prospectus Supplement(s); and (vi), if the Offered Debt Securities are being issued upon conversion, exchange or exercise of any other Securities, the Offered Debt Securities have been duly delivered to the purchasers thereof in accordance with, and against payment therefor specified in, the applicable duly authorized, executed and delivered agreements, instruments or documents, then the Offered Debt Securities will be valid and legally binding obligations of the Company, enforceable against the Company in accordance with their terms, subject to the Enforceability Limitations.
HireQuest, Inc.
May 25, 2022
Page 5 of 7
4. With respect to any Warrants to be offered by the Company pursuant to the Registration Statement, including Warrants issuable upon conversion, exchange or exercise of any other Securities (the “Offered Warrants”), provided that: (i) any applicable warrant agreement, the terms of which were established in accordance with applicable law, has been duly and validly authorized by the Company and any warrant agent named therein (the “Warrant Agent”) by all necessary corporate action; (ii) any applicable warrant agreement has been duly executed and delivered by the Company and the Warrant Agent; (iii) the issuance of the Offered Warrants has been duly authorized by all necessary corporate action on the part of the Company; (iv) the terms of the Offered Warrants and of their issuance and sale, including as to any Securities to be issued on the exercise or exchange thereof, have been duly authorized by the Company and any Warrant Agent by all necessary corporate action and have been duly established in conformity with any applicable warrant agreement, and as described in the Registration Statement, the Prospectus and the related Prospectus Supplement(s); (v) the Offered Warrants have been duly executed and delivered by the Company and authenticated by any Warrant Agent in accordance with, and against payment therefor specified in, any applicable warrant agreement and warrant and any applicable duly authorized, executed and delivered purchase, underwriting or similar agreement and as contemplated in the Registration Statement, the Prospectus and the related Prospectus Supplement(s); and (vi), if the Offered Warrants are being issued upon conversion, exchange or exercise of any other Securities, the Offered Warrants have been duly delivered to the purchasers thereof in accordance with, and against payment therefor specified in, the applicable duly authorized, executed and delivered agreements, instruments or documents, then the Offered Warrants will be valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, subject to the Enforceability Limitations.
5. With respect to any Units to be offered by the Company pursuant to the Registration Statement (the “Offered Units”), provided that: (i) the conditions outlined in the immediately preceding paragraphs (1) through (4) that apply to the Securities that make up such Offered Units are all met; (ii) any applicable unit agreement, the terms of which were established in accordance with applicable law, has been duly authorized by the Company and any unit agent named therein (the “Unit Agent”) by all necessary corporate action; (iii) any applicable unit agreement has been duly executed and delivered by the Company and the Unit Agent; (iv) the issuance of the Offered Units has been duly authorized by the Company by all necessary corporate action; (v) the terms of the Offered Units and of their issuance and sale, including as to any Securities to be issued on the conversion, exercise or exchange thereof, have been duly authorized by the Company and any Unit Agent by all necessary corporate action and have been duly established in conformity with any applicable unit agreement and as described in the Registration Statement, the Prospectus and the related Prospectus Supplement(s); (v) the Offered Units have been duly executed and delivered by the Company and authenticated by any Unit Agent in accordance with, and against payment therefor specified in, any applicable unit agreement and unit and any applicable duly authorized, executed and delivered purchase, underwriting or similar agreement and as contemplated in the Registration Statement, the Prospectus and the related Prospectus Supplement(s), and (vi) if the Offered Units are being issued upon conversion, exchange or exercise of any other Securities, the Offered Units have been duly delivered to the purchasers thereof in accordance with, and against payment therefor specified in, the applicable duly authorized, executed and delivered agreements, instruments or documents, then the Offered Units will be valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, subject to the Enforceability Limitations.
HireQuest, Inc.
May 25, 2022
Page 6 of 7
6. With respect to any Subscription Rights to be offered by the Company pursuant to the Registration Statement, including Subscription Rights issuable upon conversion, exchange or exercise of any other Securities (the “Offered Rights”), provided that: (i) any applicable rights agreement, the terms of which have been established in accordance with applicable law, has been duly and validly authorized by the Company and any rights agent named therein (the “Rights Agent”) by all necessary corporate action; (ii) any applicable rights agreement has been duly executed and delivered by the Company and the Rights Agent; (iii) the issuance of the Offered Rights has been duly authorized by all necessary corporate action on the part of the Company; (iv) the terms of the Offered Rights and of their issuance and sale, including as to any Securities to be issued on the exercise or exchange thereof, have been duly authorized by the Company and any Rights Agent by all necessary corporate action and have been duly established in conformity with any applicable rights agreement, and as described in the Registration Statement, the Prospectus and the related Prospectus Supplement(s); (v) the Offered Rights have been duly executed and delivered by the Company and authenticated by any Rights Agent in accordance with, and against payment therefor specified in, any applicable rights agreement and right and any applicable duly authorized, executed and delivered purchase, underwriting or similar agreement and as contemplated in the Registration Statement, the Prospectus and the related Prospectus Supplement(s), and (vi) if the Offered Rights are being issued upon conversion, exchange or exercise of any other Securities, the Offered Rights have been duly delivered to the purchasers thereof in accordance with, and against payment therefor specified in, the applicable duly authorized, executed and delivered agreements, instruments or documents, then the Offered Rights will be valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, subject to the Enforceability Limitations.
This opinion is limited to the Securities Act and the DGCL, in each case as currently in effect, and we express no opinion as to the effect of the laws of any other jurisdiction.
This opinion letter speaks only as of the date hereof. We assume no obligation to update or supplement this opinion letter if any applicable laws change after the date hereof or if we become aware of any facts or other developments, whether existing before or first arising after the date hereof, that might change the opinions expressed above.
HireQuest, Inc.
May 25, 2022
Page 7 of 7
We hereby consent to the use of our opinion as an exhibit to the Registration Statement and to the reference to this firm and this opinion under the heading “Legal Matters” in the prospectus comprising a part of the Registration Statement and any amendment thereto. In giving such consent, we do not admit that we come within the category of persons whose consent is required under Section 7 of the Securities Act, or the rules and regulations of the Commission thereunder.
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Sincerely,
/s/ Hill, Ward & Henderson, P.A.
HILL, WARD & HENDERSON, P.A. |
Exhibit 23.2
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in this Registration Statement on Form S-3 of our report dated March 15, 2022 with respect to the consolidated financial statements of HireQuest, Inc. as of and for the years ended December 31, 2021 and 2020. We also consent to the reference to our firm under the heading “Experts” in the Registration Statement.
| /s/ Plante & Moran, PLLC |
Denver, Colorado
May 25, 2022