As filed with the Securities and Exchange Commission on October 25, 2002
Registration No. 333-99295
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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PRE-EFFECTIVE AMENDMENT NO. 2 TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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HELEN OF TROY LIMITED
(Exact name of registrant as specified in its charter)
BERMUDA 74-2692550
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
CLARENDON HOUSE
CHURCH STREET
HAMILTON, BERMUDA
(441) 295-1422
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
1 HELEN OF TROY PLAZA
EL PASO, TEXAS 79912
(915) 225-8000
(Registrant's United States mailing address and telephone number)
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VINCENT D. CARSON
VICE PRESIDENT AND GENERAL COUNSEL
1 HELEN OF TROY PLAZA
EL PASO, TEXAS 79912
(915) 225-8000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
With a copy to:
DANIEL W. RABUN
BAKER & MCKENZIE
2001 ROSS AVENUE, SUITE 2300
DALLAS, TEXAS 75201
(214) 978-3000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after this Registration Statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the Prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
==================================================================================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF SECURITIES TO BE AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING AMOUNT OF
REGISTERED(1) REGISTERED SHARE(2) PRICE(2) REGISTRATION FEE(3)
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Common Stock, par value $.10 per share 800,000 $11.64 $9,312,000 $857
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Preference Share Purchase Rights 800,000 rights N/A N/A N/A(4)
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(1) Pursuant to Rule 416 under the Securities Act of 1933, as amended, this
registration statement covers any additional shares of common stock of Helen of
Troy Limited that become issuable by reason of any stock dividend, stock split,
recapitalization or any other similar transaction without receipt of
consideration that results in an increase in the number of outstanding shares of
common stock of Helen of Troy Limited.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) promulgated under the Securities Act of 1933, as
amended, on the basis of the average of the high and low sale prices of the
common stock on the NASDAQ National Market System on September 5, 2002.
(3) Previously paid.
(4) In accordance with Rule 457(g) under the Securities Act of 1933, as amended,
no additional registration fee is required in respect of the preference share
purchase rights.
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT SHALL
BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION, DATED OCTOBER 25, 2002
PROSPECTUS
800,000 SHARES
HELEN OF TROY LIMITED
COMMON STOCK
This prospectus relates to 800,000 shares of common stock of Helen of
Troy Limited, including the preference share purchase rights attaching to such
common stock pursuant to the Rights Agreement, dated as of December 1, 1998,
between Helen of Troy Limited and Harris Trust and Savings Bank, as Rights
Agent. The 800,000 shares of common stock offered through this prospectus will
be sold by the selling security holders listed on page 5 of this prospectus.
The sale of the common stock offered through this prospectus may be
effected by the selling security holders from time to time in transactions on
the NASDAQ National Market System, in privately negotiated transactions or in a
combination of such methods of sale. The common stock may be sold at fixed
prices that may change, at prices prevailing at the time of sale, at prices
relating to such prevailing prices or at negotiated prices. None of the proceeds
from this offering will be received by Helen of Troy Limited.
Helen of Troy Limited's common stock is listed on the NASDAQ National
Market System under the symbol "HELE." On October 24, 2002, the last reported
sale price of a share of common stock on the NASDAQ National Market System was
$9.19.
INVESTING IN THE COMMON STOCK INVOLVES RISKS. POTENTIAL INVESTORS
SHOULD CONSIDER CAREFULLY THE RISK FACTORS BEGINNING ON PAGE 1 OF THIS
PROSPECTUS.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this prospectus is _________, 2002.
TABLE OF CONTENTS
ABOUT HELEN OF TROY LIMITED......................................................................................1
THE OFFERING.....................................................................................................1
RISK FACTORS.....................................................................................................1
USE OF PROCEEDS..................................................................................................4
PLAN OF DISTRIBUTION.............................................................................................5
SELLING SECURITY HOLDERS.........................................................................................5
LEGAL MATTERS....................................................................................................5
EXPERTS..........................................................................................................5
RECENT DEVELOPMENTS..............................................................................................5
SELECTED FINANCIAL DATA..........................................................................................5
INFORMATION RELATING TO FORWARD-LOOKING STATEMENTS...............................................................6
INCORPORATION OF DOCUMENTS BY REFERENCE..........................................................................7
WHERE YOU CAN FIND MORE INFORMATION..............................................................................8
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS. HELEN OF
TROY LIMITED HAS NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION DIFFERENT
FROM THAT CONTAINED IN THIS PROSPECTUS. THIS PROSPECTUS IS NOT AN OFFER TO SELL
OR A SOLICITATION OF AN OFFER TO BUY COMMON STOCK IN ANY JURISDICTION WHERE IT
IS UNLAWFUL. 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 COMMON STOCK.
ABOUT HELEN OF TROY LIMITED
Unless the context requires otherwise, references to "the Company," to
"our Company" or to "Helen of Troy" and references such as "we" and "us" refer
to Helen of Troy Limited and its subsidiaries, including Tactica International,
Inc. ("Tactica"). Our Company is comprised of three operating segments. The
North American segment sells hair care and other personal care and comfort
appliances, hairbrushes, combs and utility and decorative hair accessories in
the U.S. and Canada. The International segment sells hair care and other
personal care and comfort appliances, hairbrushes, combs and utility and
decorative hair accessories outside of the U.S. and Canada. Our third segment,
Tactica, sells personal care and other consumer products directly to consumers
through direct response marketing and to retailers.
We design, develop and sell a variety of personal care and comfort
products under trademarks licensed from third parties, as well as under
trademarks that we own. We outsource the manufacture of our products to third
parties and sell most of those products to mass merchandisers, drug chains,
warehouse clubs, grocery stores, beauty supply retailers and wholesalers, and
directly to consumers in the U.S. and other countries.
Products bearing licensed trademarks include those sold under the
trademarks of VS Sassoon(R), licensed from The Procter & Gamble Company;
Revlon(R), licensed from Revlon Consumer Products Corporation; Dr. Scholl's(R),
licensed from Schering-Plough HealthCare Products, Inc.; Scholl(R) (in areas
other than North America), licensed from Scholl Limited; and Sunbeam(R),
licensed from Sunbeam Products, Inc. Trademarks owned by the Company include
Helen of Troy(R), Salon Edition(R), Hot Tools(R), Ecstasy(TM), Gold Series(R),
Hotspa(R), Gallery Series(R), Wigo(R), Caruso(TM), Dazey(R), Lady Dazey(R),
Carel(R), Lady Carel(R), Sable(R), Karina(R), Karina Girl(TM), Kurl*Mi(R),
Detangle*Mi(R), Heat*Mi(R), DCNL(TM), DCNL Signature(TM), IGIA(R) and
Epil-Stop(R).
We were incorporated as Helen of Troy Corporation in Texas in 1968 and
reincorporated as Helen of Troy Limited in Bermuda in 1994. Our principal
executive offices are located at Clarendon House, Church Street, Hamilton,
Bermuda. Our telephone number in the United States is (915) 225-8000.
THE OFFERING
This prospectus relates to 800,000 shares of common stock of Helen of
Troy that may be offered by the selling security holders. In August 2002, Gerald
J. Rubin, our Chairman of the Board, Chief Executive Officer and President, as
well as the founder and a director of the Company, sold 800,000 shares of common
stock to certain accredited investors in privately negotiated transactions. As
part of those transactions, we entered into registration rights agreements with
the investors with respect to the purchased shares. The Company's agreement to
register the shares was a condition to the investors purchasing the shares from
Mr. Rubin. We agreed to enter into the registration rights agreements and
register the shares of common stock as an accommodation to Mr. Rubin, the
founder of Helen of Troy. We are registering the common stock covered by this
prospectus to fulfill our contractual obligations with respect to the
registration rights agreements. Mr. Rubin is not a party to the registration
rights agreements. Registration of the common stock does not necessarily mean
that all or any portion of such shares will be offered for sale by the selling
security holders.
We have agreed to bear the expenses of the registration of the common
stock under federal and state securities laws, but we will not receive any
proceeds from the sale of the common stock offered under this prospectus. We are
not receiving any compensation from Mr. Rubin for registering the common stock.
RISK FACTORS
INVESTING IN OUR COMMON STOCK IS VERY RISKY. YOU SHOULD BE ABLE TO BEAR
A COMPLETE LOSS OF YOUR INVESTMENT. YOU SHOULD CAREFULLY CONSIDER THE FOLLOWING
FACTORS IN ADDITION TO OTHER INFORMATION CONTAINED ELSEWHERE IN THIS PROSPECTUS
OR INCORPORATED BY REFERENCE INTO THIS PROSPECTUS FROM OUR OTHER FILINGS WITH
THE SECURITIES AND EXCHANGE COMMISSION (THE "SEC"). IF ANY OF THESE RISKS
ACTUALLY OCCURS, OUR BUSINESS, FINANCIAL CONDITION AND RESULTS OF OPERATIONS
COULD SUFFER.
OUR INDUSTRY IS EXTREMELY COMPETITIVE. OUR BUSINESS WILL SUFFER IF WE
DO NOT DEVELOP AND COMPETITIVELY MARKET PRODUCTS THAT APPEAL TO CONSUMERS. The
personal care and comfort products industry is extremely competitive.
Maintaining and gaining market share depends heavily upon price, quality, brand
name recognition, patents, innovation in the design of new products and
replacement models and marketing and distribution approaches. We compete with
domestic and international companies, some of which have substantially greater
financial and other resources than those of the Company. We believe that our
ability to produce reliable products that incorporate developments in technology
and to satisfy consumer tastes with respect to style and design, as well
as our ability to market a broad offering of products in each applicable
category at competitive prices, are keys to our future success. No assurance can
be given that we will be able to successfully compete on the basis of these
factors in the future.
WE ARE MATERIALLY DEPENDENT ON OUR LICENSED TRADEMARKS AS A SUBSTANTIAL
PORTION OF OUR SALES REVENUE COMES FROM SELLING PRODUCTS UNDER LICENSED
TRADEMARKS. OUR BUSINESS, FINANCIAL CONDITION AND RESULTS OF OPERATIONS COULD BE
MATERIALLY ADVERSELY AFFECTED IF WE ARE UNABLE TO SELL PRODUCTS UNDER THESE
TRADEMARKS. A substantial portion of our sales revenue is derived from sales of
products under licensed trademarks. As a result, we are materially dependent
upon the continued use of such trademarks, particularly the VS Sassoon(R) and
Revlon(R) trademarks. Actions taken by licensors and other third parties could
diminish greatly the value of any of our licensed trademarks. If we were unable
to sell products under these licensed trademarks the effect on our business,
financial condition and results of operations could be both negative and
material.
WE COULD BE MATERIALLY ADVERSELY EFFECTED BY SIGNIFICANT CHANGES IN THE
TAX LAWS. Currently, we benefit from an international corporate structure that
results in relatively low tax rates on a consolidated basis. If we were to
encounter significant changes in the rates or rules imposed by certain key
taxing jurisdictions, such changes could have a material adverse effect on the
Company's financial position and profitability. In 1994, we engaged in a
corporate restructuring that, among other things, resulted in a greater portion
of our income not being subject to taxation in the U.S. If such income were
subject to U.S. federal income taxes, our effective income tax rate would
increase materially. Several bills have been introduced recently in the U.S.
Congress that, if enacted into law, could adversely affect our U.S. federal
income tax status. At least one of the bills introduced would apply to companies
such as ours that restructured several years ago. That bill could, if enacted
into law, subject a greater portion of our income to U.S. income taxes, thereby
reducing our net income. Other bills introduced recently would exempt
restructuring transactions, such as ours, that were completed before certain
dates in 2001 and 2002, but would limit the deductibility of payments made in
certain intercompany transactions for U.S. income tax purposes and would subject
gains on certain asset transfers to U.S. income tax. In addition to the
legislation introduced in Congress, the U.S. Treasury Department recently
published a study of restructurings such as ours. It is not currently possible
to predict whether the legislation that has been introduced will become law,
whether any additional bills will be introduced or the consequences of the U.S.
Treasury Department's study. However, there is a risk that new laws in the U.S.
could eliminate or substantially reduce the current income tax benefits of our
corporate structure. If this were to occur, such changes could have a material
adverse effect on our financial condition and results of operations. In addition
to potential changes in tax laws, the Company's position on various tax matters
may be challenged. Our ability to maintain our position that the parent company
is not a Controlled Foreign Corporation (as defined under the U.S. Internal
Revenue Code) is critical to the tax treatment of our non-U.S. earnings. A
Controlled Foreign Corporation is a non-U.S. corporation whose largest U.S.
shareholders (i.e., those owning 10% or more of its stock) together own more
than 50% of the stock in such corporation. If a change of ownership of the
Company were to occur such that the parent company became a Controlled Foreign
Corporation, such a change could have a material negative effect on the largest
U.S. shareholders and, in turn, on the Company's business.
THE HONG KONG INLAND REVENUE DEPARTMENT HAS CHALLENGED OUR POSITION ON
CERTAIN PROFITS AND ASSESSED TAXES ON SUCH PROFITS. WE HAVE SETTLED CERTAIN OF
THE CHALLENGES; HOWEVER, CERTAIN AMOUNTS ARE STILL OUTSTANDING AND WE MAY HAVE
TO PAY FURTHER AMOUNTS IN THE FUTURE. The Hong Kong Inland Revenue Department
("the IRD") assessed $11,033,000 in tax on certain profits of our foreign
subsidiaries for the fiscal years 1990 through 1997. Hong Kong taxes income
earned from certain activities conducted in Hong Kong. We are vigorously
defending our position that we conducted the activities that produced the
profits in question outside of Hong Kong. The Company also asserts that it has
complied with all applicable reporting and tax payment obligations. In
connection with the IRD's tax assessment for the fiscal years 1990 through 1997,
we were required to purchase $5,750,000 (U.S.) in tax reserve certificates in
Hong Kong, which represented approximately 52% of the liability assessed by the
IRD. Tax reserve certificates represent the prepayment by a taxpayer of
potential tax liabilities. The amounts paid for tax reserve certificates are
refundable in the event that the value of the tax reserve certificates exceeds
the related tax liability. These certificates are denominated in Hong Kong
dollars and are subject to the risks associated with foreign currency
fluctuations.
The Company and the IRD agreed on a settlement for fiscal years 1990
through 1994. The assessment for that period was $4,468,000. The Company and the
IRD agreed to settle the amount for $2,505,000 (56% of the assessed amount),
plus interest of approximately $100,000. Because we were able to apply certain
of the tax reserve certificates discussed above to amounts due under the
proposed settlement, the Company paid the IRD approximately $37,000 of
additional cash, plus interest to settle the issues raised by the IRD for fiscal
1990 through 1994. The settlement of the IRD's assessments for fiscal 1990
through 1994 did not affect the status of the IRD's assessments for fiscal years
1995 through 1997. If the IRD's position were to prevail and if it were to
assert the
2
same position for years after fiscal 1997, the resulting assessment could total
$28,015,000 (U.S.) for the period from fiscal 1995 through fiscal 2002. Although
the ultimate resolution of the IRD's claims cannot be predicted with certainty,
we believe that adequate provision has been made in the financial statements for
the resolution of the IRD's assessments for the fiscal years 1990 through 1997
and potential future assessments relating to activity since fiscal 1997.
WE ARE DEPENDENT ON THIRD PARTY MANUFACTURERS, MOST OF WHICH ARE IN THE
FAR EAST. CHANGES IN FOREIGN POLICY, INTERNATIONAL LAW OR THE INTERNAL LAWS OF
THE COUNTRIES WHERE OUR MANUFACTURERS ARE LOCATED COULD HAVE A MATERIAL NEGATIVE
AFFECT ON OUR BUSINESS, FINANCIAL CONDITION AND RESULTS OF OPERATIONS. All of
our products are manufactured by unaffiliated companies, most of which are in
the Far East. Risks associated with such foreign manufacturing include: changing
international political relations; changes in laws, including tax laws,
regulations and treaties; changes in labor laws, regulations, and policies;
changes in customs duties and other trade barriers; changes in shipping costs;
currency exchange fluctuations; local political unrest; and the availability and
cost of raw materials and merchandise. To date, these factors have not
significantly affected our production in the Far East. However, any change that
impairs our ability to obtain products from such manufacturers, or to obtain
products at marketable rates, could have a material negative effect on our
business, financial condition and results of operations.
OUR BUSINESS, FINANCIAL CONDITION AND RESULTS OF OPERATIONS WILL SUFFER
IF WE DO NOT ACCURATELY FORECAST OUR CUSTOMER'S DEMANDS. Because of our reliance
on manufacturers in the Far East, our production lead times are relatively long.
Therefore, we must commit to production in advance of customer orders. If we
fail to forecast customer or consumer demand accurately we may encounter
difficulties in filling customer orders or in liquidating excess inventories, or
may find that customers are canceling orders or returning products. Distribution
difficulties may have an adverse effect on our business by increasing the amount
of inventory and the cost of storing inventory. Additionally, changes in
retailer inventory management strategies could make inventory management more
difficult. Any of these results could have a material adverse effect on our
business, financial condition and results of operations.
OUR FUTURE ACQUISITIONS, IF ANY, AND NEW PRODUCTS MAY NOT BE
SUCCESSFUL, WHICH COULD HAVE A MATERIAL ADVERSE AFFECT ON OUR FINANCIAL
CONDITION AND RESULTS OF OPERATIONS. We may decide to grow our business through
the acquisition of new product lines and businesses. The acquisition of a
business or of the rights to market specific products or use specific product
names involves a financial commitment. In the case of an acquisition such
commitments are usually in the form of either cash or stock consideration. In
the case of a new license, such commitments could take the form of license fees,
prepaid royalties and future minimum royalty and advertising payments. While our
strategy is to acquire businesses and to develop products that will contribute
positively to earnings, there is no guarantee of such results. Anticipated
synergies may not materialize, cost savings may be less than expected, sales of
products may not meet expectations and acquired businesses may carry unexpected
liabilities. Each of these factors could result in a newly acquired business or
product line having a material negative impact on financial condition and
results of operations.
A FEW CUSTOMERS ACCOUNT FOR A SUBSTANTIAL PERCENTAGE OF OUR SALES. OUR
FINANCIAL CONDITION AND RESULTS OF OPERATIONS COULD SUFFER IF WE LOST ALL OR A
PORTION OF THE SALES TO THESE CUSTOMERS. We are dependent on certain principal
customers. Wal-Mart Stores, Inc. and its affiliates accounted for approximately
22% of the Company's net sales in fiscal 2002. Our top three customers accounted
for approximately 35% of fiscal 2002 net sales. Although we have long-standing
relationships with our major customers, no contracts require these customers to
buy from us. A substantial decrease in sales to any of our major customers could
have a material adverse effect on our financial condition and results of
operations.
THE SALES OF OUR TACTICA PRODUCTS MAY BE SUBJECT TO VOLATILITY. OUR
FINANCIAL CONDITION AND RESULTS OF OPERATIONS COULD BE ADVERSELY AFFECTED BY A
DECREASE IN SALES OF TACTICA PRODUCTS. Tactica's net sales grew substantially in
fiscal 2002 from fiscal 2001, comprising 24% and 5%, respectively, of the
Company's consolidated net sales during such periods. In addition, the increase
in Tactica's sales in fiscal 2002 accounted for 94% of the increase in our
consolidated sales during this period. Tactica's sales in fiscal 2002 were
comprised heavily of the Epil-Stop(R) product line, which has an unproven
product life cycle. Tactica also sells other products that have short life
cycles. Furthermore, Tactica relies on television infomercials and direct
response marketing campaigns for the marketing of its products. Accordingly,
Tactica's sales may be more volatile than the business of our other two
segments. The results of our business could be adversely affected by decreases
in sales of Tactica products.
ONE OF OUR SUBSIDIARIES IS SUBJECT TO A STOCKHOLDERS' AGREEMENT WITH
THE FORMER STOCKHOLDERS OF TACTICA. UNDER THE TERMS OF THE STOCKHOLDERS'
AGREEMENT, UNDER CERTAIN CIRCUMSTANCES WE COULD BE REQUIRED TO BUY THE REMAINING
OUTSTANDING SHARES OF TACTICA OR SELL OUR TACTICA SHARES TO A THIRD PARTY. THE
COMPANY'S FINANCIAL
3
CONDITION COULD BE NEGATIVELY IMPACTED IF IT WAS FORCED TO CHANGE ITS OWNERSHIP
POSITION IN TACTICA. One of our subsidiaries is a party to a stockholders'
agreement with the former owners of Tactica, who retained a 45% interest in
Tactica (collectively the "other Tactica stockholders"). Under the terms of the
stockholders' agreement, we have been granted the right to initiate a process
whereby we can purchase, and the other Tactica stockholders are required to
sell, the shares they own. In addition, the other Tactica stockholders have the
right to initiate a process regarding the sale of their remaining interest in
Tactica. We may elect at our option not to purchase the shares owned by the
other Tactica stockholders and under the terms of the stockholders' agreement
the parties will then be required to initiate a procedure under which the entire
business of Tactica would be offered for sale to third parties. In either case,
the purchase price will be based upon fair market value as determined by
independent appraisal. A sale to a third party would be subject to the approval
of the other Tactica stockholders and us. In the event that either party
exercises its rights under the stockholders' agreement, our financial position
and profitability could be adversely affected.
USE OF PROCEEDS
We will not receive any proceeds from the sale of the common stock
offered by this prospectus.
PLAN OF DISTRIBUTION
We are registering the shares of common stock on behalf of the selling
security holders. The shares of common stock may be sold in one or more
transactions at fixed prices, at prevailing market prices at the time of sale,
at prices related to the prevailing market prices, at varying prices determined
at the time of sale or at negotiated prices. These sales may be effected at
various times in one or more of the following transactions, or in other kinds of
transactions:
o transactions on the NASDAQ National Market System or on any
national securities exchange or U.S. inter-dealer system of a
registered national securities association on which our common
stock may be listed or quoted at the time of sale;
o in the over-the-counter market;
o in private transactions and transactions otherwise than on
these exchanges or systems or in the over-the-counter market;
o in connection with short sales of the common stock;
o by pledge to secure or in payment of debt and other
obligations;
o through the writing of options, whether the options are listed
on an options exchange or otherwise;
o in connection with the writing of non-traded and
exchange-traded call options, in hedge transactions and in
settlement of other transactions in standardized or
over-the-counter options; or
o through a combination of any of the above transactions.
The selling security holders and their successors, including their
transferees, pledgees or donees or their successors, may sell the shares of
common stock directly to purchasers or through underwriters, broker-dealers or
agents, who may receive compensation in the form of discounts, concessions or
commissions from the selling security holders or the purchasers. These
discounts, concessions or commissions as to any particular underwriter,
broker-dealer or agent may be in excess of those customary in the types of
transactions involved.
In addition, any securities covered by this prospectus which qualify
for sale pursuant to Rule 144 of the Securities Act of 1933, as amended (the
"Securities Act"), may be sold under Rule 144 rather than pursuant to this
prospectus.
We entered into registration rights agreements for the benefit of the
selling security holders to register our common stock under applicable federal
and state securities laws. The registration rights agreements provide for cross-
indemnification of the selling security holders and us and our respective
directors, officers and controlling persons against specific liabilities in
connection with the offer and sale of the common stock, including liabilities
4
under the Securities Act. We will pay substantially all of the expenses incurred
by the selling security holders incident to the offering and sale of the common
stock.
SELLING SECURITY HOLDERS
In August 2002, Gerald J. Rubin, our Chairman of the Board, Chief
Executive Officer and President, as well as the founder and a shareholder of the
Company, sold 800,000 shares of common stock to certain accredited investors in
privately negotiated transactions. As part of those transactions, we entered
into registration rights agreements with the investors with respect to the
purchased shares of common stock. We are registering the shares of common stock
covered by this prospectus to fulfill our contractual obligations with respect
to these registration rights.
The following table provides information with respect to the shares of
common stock beneficially owned by the selling security holders. The information
regarding common stock owned after the offering assumes the sale of all shares
of common stock offered by the selling security holders. None of the selling
security holders has held a position or office or had a material relationship
with us or any of our affiliates within the past three years other than as a
result of the ownership of our common stock. The control persons of Acqua
Wellington Private Placement Fund, Ltd. and Acqua Wellington Opportunity I
Limited are Helen Forbes and Michael Taylor, respectively. Neither selling
security holder nor their respective control person is a broker-dealer nor are
they affiliates of the Company.
COMMON STOCK OWNED
AFTER COMPLETION
COMMON STOCK COMMON OF OFFERING(1)
BENEFICIALLY STOCK -------------------------
NAME OWNED OFFERED NUMBER PERCENTAGE
---- ------------ ------- ------ ----------
Acqua Wellington Private Placement Fund, Ltd. 200,000 200,000 0 0%
Acqua Wellington Opportunity I Limited 600,000 600,000 0 0%
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(1) Assumes all of the shares of common stock are sold.
LEGAL MATTERS
The validity of the common stock will be passed upon for us by Conyers
Dill & Pearman, Bermuda counsel to Helen of Troy.
EXPERTS
KPMG LLP, independent auditors, are our auditors. They audited the
consolidated financial statements and the financial statement schedules that we
included in our Annual Report on Form 10-K for the fiscal year ended February
28, 2002, as described in their report dated May 3, 2002. The Annual Report on
Form 10-K for the fiscal year ended February 28, 2002, includes these reports.
We incorporate these financial statements, schedules and reports into this
prospectus in reliance on KPMG LLP's authority as experts in accounting and
auditing.
RECENT DEVELOPMENTS
On October 21, 2002, we acquired directly and through license
agreements, six consumer brand names from The Procter & Gamble Company. We will
create a new operating division to market these products. We also entered into
several agreements with The Procter & Gamble Company whereby they will continue
to market, manufacture and distribute products using these brands for a
six-month transition period. In addition, we agreed to pay for inventory that
The Procter & Gamble Company has on hand at the end of the six-month transition
period. We estimate that the combination of the purchase price, inventory
purchase, and on-going working capital requirements associated with the purchase
of these brands will reduce our cash and working capital by $45,000,000 to
$50,000,000.
SELECTED FINANCIAL DATA
Below is summarized financial information comparing previously reported
net income for the three years ended February 28, 2002 as though the provisions
of SFAS 142 had been applied as of March 1, 1999 (amounts in thousands, except
per share data):
5
Year Ended the last day of February
----------------------------------------------
2002 2001 2000
------------ ------------ ------------
Reported net income $ 29,215 $ 17,332 $ 13,111
Goodwill amortization 2,034 2,026 1,948
------------ ------------ ------------
Adjusted net income $ 31,249 $ 19,358 $ 15,059
============ ============ ============
Basic earnings per share of common stock
Reported net income $ 1.04 $ .61 $ .45
Goodwill amortization .07 .07 .07
------------ ------------ ------------
Adjusted basic earnings per share of common
stock $ 1.11 $ .68 $ .52
============ ============ ============
Diluted earnings per share of common stock
Reported net income $ 1.00 $ .60 $ .44
Goodwill amortization .07 .07 .06
------------ ------------ ------------
Adjusted diluted earnings per share of
common stock $ 1.07 $ .67 $ .50
============ ============ ============
INFORMATION RELATING TO FORWARD-LOOKING STATEMENTS
Certain written and oral statements made by us or with the approval of
one of our authorized executive officers may constitute "forward-looking
statements" as defined under the Private Securities Litigation Reform Act of
1995. This includes statements made in this registration statement, in other
filings with the SEC, in press releases and in certain other oral and written
presentations. Generally, the words "anticipates," "believes," "expects" and
other similar words identify forward-looking statements. All statements that
address operating results, events or developments that we expect or anticipate
will occur in the future, including statements related to sales, earnings per
share results and statements expressing general expectations about future
operating results, are forward-looking statements. We caution readers not to
place undue reliance on forward-looking statements. Forward-looking statements
are subject to risks that could cause such statements to differ materially from
actual results. We undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.
Factors that could cause actual results to differ from those
anticipated include the following, among others:
o general industry conditions and competition;
o credit risks;
o our, or our operating segments', material reliance on
individual customers or small numbers of customers;
o our material reliance on certain trademarks;
o the impact of tax legislation, regulations or treaties,
including proposed legislation in the United States that would
affect companies or subsidiaries of companies that have
headquarters outside the United States and file U.S. income
tax returns;
o the impact of other current and future laws and regulations;
o the results of our disagreement with the Hong Kong Inland
Revenue Department concerning the portion of our profits that
might be subject to Hong Kong income tax;
6
o any future disagreements with the United States Internal
Revenue Service or other taxing authority regarding our
assessment of the effects or interpretation of existing tax
laws, regulations or treaties;
o risks associated with inventory, including potential
obsolescence;
o risks associated with new products and new product lines;
o risks associated with operating in foreign jurisdictions;
o foreign currency exchange losses;
o worldwide and domestic economic conditions;
o uninsured losses;
o reliance on computer systems;
o management's reliance on the representations of third parties;
o risks associated with new business ventures and acquisitions;
o risks associated with investments in equity securities; and
o the risks described from time to time in our filings with the
SEC.
INCORPORATION OF DOCUMENTS BY REFERENCE
The SEC allows us to incorporate by reference in this prospectus the
information we file with them, which means that we can disclose important
information to you by referring you to those documents. The information
incorporated by reference is considered to be part of this prospectus, and
information that we file later with the SEC will automatically update and
supersede the information in this prospectus. Accordingly, we incorporate by
reference the information listed below:
o our Annual Report on Form 10-K for the fiscal year ended
February 28, 2002;
o our Quarterly Report on Form 10-Q for the fiscal quarter ended
May 31, 2002;
o our Current Report on Form 8-K filed with the SEC on September
27, 2002;
o our Quarterly Report on Form 10-Q for the fiscal quarter ended
August 31, 2002;
o the description of our common stock, which is contained in our
registration statement filed with the SEC (Registration No.
0-23312), including any amendments or reports filed for the
purpose of updating such description; and
o the description of our preference share purchase rights, which
is contained in our Registration Statement on Form 8-A filed
with the SEC on December 4, 1998, including any amendments or
reports filed for the purpose of updating such description.
All reports and other documents we subsequently file pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as
amended, prior to the termination of this offering will also be incorporated by
reference into this prospectus and deemed to be part of this prospectus from the
date of the filing of such reports and documents.
We will provide without charge to each person, including any beneficial
owner, to whom this prospectus is delivered, upon written or oral request, a
copy of any or all documents that are incorporated into this prospectus by
reference, but not delivered with the prospectus, other than exhibits to such
documents unless such exhibits are
7
specifically incorporated by reference into the documents that this prospectus
incorporates. You should direct such requests to:
Helen of Troy
1 Helen of Troy Plaza
El Paso, Texas 79912
Attn: General Counsel
Telephone (915) 225-8000
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any document we file at
the SEC's Public Reference Room at 450 Fifth Street, N.W. Washington, D.C.,
20549. Please call the SEC at 1-800-SEC-0330 for further information on the
Public Reference Room. Our SEC filings are also available to the public at the
SEC's web site at http://www.sec.gov.
8
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following sets forth the best estimate of the Company as to its
anticipated expenses and costs expected to be incurred in connection with the
issuance and distribution of the securities registered hereby (except for the
SEC registration fee, all amounts are estimates):
SEC Registration Fee ....................... $ 857
Printing and Engraving Expenses ............ 500
Legal Fees and Expenses .................... 5,000
Accounting Fees and Expenses ............... 2,500
Miscellaneous .............................. 500
----------
Total ...................................... $ 9,357
==========
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 98 of the Companies Act 1981 of Bermuda (as amended, the "Act")
provides generally that a Bermuda company may indemnify its directors, officers
and auditors against any liability which by virtue of any rule of law would be
imposed on them in relation to the Company, except in cases where such liability
arises from fraud or dishonesty of which such officer, director or auditor may
be guilty in relation to the Company. Section 98 further provides that a Bermuda
company may indemnify its directors, officers and auditors against any liability
incurred against them in defending any proceedings, whether civil or criminal,
in which judgment is awarded in their favor or they are acquitted or granted
relief by the Supreme Court of Bermuda in certain proceedings arising under
Section 281 of the Act.
The Company has adopted provisions in its Memorandum of Association and
Bye-Laws that provide that the Company shall indemnify its officers and
directors to the maximum extent permitted under the Act. The Company has also
entered into indemnity agreements with each of its directors and officers to
provide them with the maximum indemnification allowed under its Memorandum of
Association, Bye-Laws and the Act.
The Act also permits a company to purchase and maintain insurance for
the benefit of its officers and directors covering certain liabilities. The
Company intends to maintain a policy of officers' and directors' liability
insurance for the benefit of such persons.
We entered into registration rights agreements for the benefit of the
selling security holders to register our common stock under applicable federal
and state securities laws. The registration rights agreements provide for cross-
indemnification of the selling security holders and us and our respective
directors, officers and controlling persons against specific liabilities in
connection with the offer and sale of the common stock, including liabilities
under the Securities Act.
The preceding discussion of the Company's Memorandum of Association and
Bye-Laws, the Act, the indemnity agreements and the registration rights
agreements is not intended to be exhaustive and is qualified in its entirety by
the Memorandum of Association, Bye-Laws, the Act, the indemnity agreements and
the registration rights agreements.
ITEM 16. EXHIBITS.
EXHIBIT
NUMBER DESCRIPTION
4.1 Memorandum of Association (filed as Exhibit 3.1 to the Company's
Registration Statement on Form S-4, File No. 33-73594, filed with
the SEC on December 30, 1993).
4.2 Bye-Laws (filed as Exhibit 3.2 to the Company's Registration
Statement on Form S-4, File No. 33-73594, filed with the SEC on
December 30, 1993).
4.3 Rights Agreement, dated as of December 1, 1998, between Helen of
Troy Limited and Harris Trust and Savings Bank, as Rights Agent
(filed as Exhibit 7.4 to the Company's Current Report on Form 8-K,
filed with the SEC on December 4, 1998).
II-1
5.1 Opinion of Conyers Dill & Pearman.
23.1 Consent of Conyers Dill & Pearman (See Exhibit 5.1).
23.2 Consent of KPMG LLP.
ITEM 17. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by section
10(a)(3) of the Securities Act;
(ii) To reflect in the Prospectus any facts or events
arising after the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in the
Registration Statement. Notwithstanding the foregoing, any increase or decrease
in volume of securities offered (if the total dollar value of securities offered
would not exceed that which was registered) and any deviation from the low or
high end of the estimated maximum offering range may be reflected in the form of
prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20 percent 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 (a)(1)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
section 13 or section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or 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.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the SEC 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 and will be governed by the final
adjudication of such issue.
II-2
(d) The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the
Securities Act, the information omitted from the form of prospectus filed as
part of this Registration Statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4),
or 497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
(2) For the purposes of determining any liability under the
Securities Act, each post-effective amendment that contains a form of prospectus
shall be determined 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.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of El Paso, State of Texas, on October 25, 2002.
HELEN OF TROY LIMITED
By: /s/ Gerald J. Rubin
-----------------------------------------
Gerald J. Rubin
Chairman of the Board, Chief Executive
Officer, President and Director
Pursuant to the requirements of the Securities Act, this registration
statement has been signed by the following persons in the capacities and on the
date indicated.
Signature Title Date
--------- ----- ----
/s/ Gerald J. Rubin Chairman of the Board, Chief Executive Officer, October 25, 2002
--------------------------------------- President and Director (Principal Executive Officer)
Gerald J. Rubin
* Senior Vice President, Finance, and Chief Financial October 25, 2002
--------------------------------------- Officer (Principal Financial and Accounting Officer)
Russell G. Gibson
* Director October 25, 2002
---------------------------------------
Stanlee N. Rubin
* Director October 25, 2002
---------------------------------------
Christopher Carameros
* Director October 25, 2002
---------------------------------------
Byron H. Rubin
* Director October 25, 2002
---------------------------------------
Daniel C. Montano
* Director October 25, 2002
---------------------------------------
Gary B. Abromovitz
* Director October 25, 2002
---------------------------------------
John B. Butterworth
* By: /s/ Gerald J. Rubin
---------------------------------------
Gerald J. Rubin
Attorney-in-fact
S-1
INDEX TO EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
------- -----------
4.1 Memorandum of Association (filed as Exhibit 3.1 to the Company's
Registration Statement on Form S-4, File No. 33-73594, filed with
the SEC on December 30, 1993).
4.2 Bye-Laws (filed as Exhibit 3.2 to the Company's Registration
Statement on Form S-4, File No. 33-73594, filed with the SEC on
December 30, 1993).
4.3 Rights Agreement, dated as of December 1, 1998, between Helen of
Troy Limited and Harris Trust and Savings Bank, as Rights Agent
(filed as Exhibit 7.4 to the Company's Current Report on Form 8-K,
filed with the SEC on December 4, 1998).
5.1 Opinion of Conyers Dill & Pearman.
23.1 Consent of Conyers Dill & Pearman (See Exhibit 5.1).
23.2 Consent of KPMG LLP.