As filed with the Securities and Exchange Commission on February 11, 1998.
Registration Statement No. 333-_______
===============================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________________
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
________________________
TRAVIS BOATS & MOTORS, INC.
(Exact name of Registrant)
Texas 74-2024798
(State of incorporation) (I.R.S. Employer
Identification No.)
Mark T. Walton, Chairman of the Board and President
Travis Boats & Motors, Inc.
5000 Plaza on the Lake, Suite 250
Austin, Texas 78746
(512) 347-8787
(Address and telephone number of Registrant's executive offices and name,
address and telephone number of agent for service)
Copy to:
J. Rowland Cook
Mark E. Mouritsen
Jenkens & Gilchrist
A Professional Corporation
600 Congress Avenue, Suite 2200
Austin, Texas 78701
(512) 499-3800
Approximate date of commencement of proposed sale to the public: From
time to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. ___
If any of the securities being registered on this form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities
Act of 1933, other than securities offered only in connection with dividend
or interest reinvestment plans, check the following box. _ X_
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of
the earlier effective registration statement for the same offering. ___
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. ___
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. ___
_________________________________________________________
CALCULATION OF REGISTRATION FEE
Proposed
Maximum
Title of Each Amount Offering Proposed Amount of
Class of Securities to be Price Per Maximum Aggregate Registration
to be Registered Registered Share(1) Offering Price(1) Fee
- -------------------- ---------- --------- ----------------- ------------
Common Stock, $.01 91,905 $23.875 $2,194,232 $636
par value
(1) Estimated solely for purposes of calculating the registration fee and
based upon the average of the high and low prices reported on the Nasdaq
National Market on February 10, 1998, in reliance on Rule 457(c) under
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 of 1933 or until the Registration
Statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
<PAGE>
Subject to Completion; Dated February 11, 1998
91,905 Shares
TRAVIS BOATS & MOTORS, INC.
Common Stock
This Prospectus relates to an aggregate of 91,905 shares (the
"Shares") of common stock, par value $.01 per share ("Common Stock"), of
Travis Boats & Motors, Inc. ("Travis Boats" or the "Company"). The Common
Stock is currently traded over-the-counter on the Nasdaq National Market
("Nasdaq") under the symbol TRVS. On February 10, 1998, the closing sale
price of the Common Stock on Nasdaq was $23.875 per share.
The Shares may be offered from time to time by persons (collectively,
the "Selling Shareholders") who acquired the Shares in a transaction or
chain of transactions not involving a public offering. The Selling
Shareholders have indicated that the Shares may be sold in the over-the-
counter market or otherwise at prevailing market prices or negotiated
prices or by a combination of the foregoing methods of sale. No
underwriter has been engaged to participate in the offering of the Shares.
The Company will receive no portion of the proceeds of any sales of Shares
by the Selling Shareholders. See "Plan of Distribution."
THESE SECURITIES INVOLVE CERTAIN RISKS.
SEE "RISK FACTORS" BEGINNING ON PAGE 5.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES ADMINISTRATOR, NOR
HAS THE COMMISSION OR ANY SUCH ADMINISTRATOR PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is February 11, 1998.
<PAGE>
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement (of which this Prospectus is a part)
under the Securities Act of 1933, as amended (the "Securities Act"), with
respect to the Shares. This Prospectus does not contain all the
information set forth in the Registration Statement, certain portions of
which have been omitted as permitted by the rules and regulations of the
Commission. For further information with respect to the Company and the
Shares, reference is made to such Registration Statement and exhibits.
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information
with the Commission. The Registration Statement, the exhibits forming a
part thereof, and the reports, proxy statements and other information can
be inspected and copied at the public reference facilities maintained by
the Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C.
20549, and at the following regional offices of the Commission: 7 World
Trade Center, 13th Floor, New York, New York 10048 and Northwest Atrium
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. The
Commission maintains a web site (http:\\www.sec.gov) that contains reports,
proxy and information statements and other information regarding
registrants, such as the Company, that file electronically with the
Commission. The Company's Common Stock is traded on the Nasdaq National
Market. Reports, proxy statements and other information concerning the
Company can also be inspected at the office of the Nasdaq Stock Market,
1735 K Street, N.W., Washington, D.C. 20006-1500.
The statements contained in this Prospectus that are not historical
facts, including but not limited to, statements found in the "The Company"
and "Risk Factors," are forward-looking statements as that term is defined
in Section 21E of the Exchange Act that involve a number of risks and
uncertainties. The actual results of the future events described in the
forward-looking statements in this Prospectus could differ materially from
those stated in such forward-looking statements. Among the factors that
could cause actual results to differ materially are: general economic
conditions, competition and government regulations, as well as the risks
and uncertainties discussed in this Prospectus, including without
limitation, the matters discussed in "Risk Factors" and the uncertainties
set forth from time to time in the Company's other public reports, filings,
and public statements.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated herein by reference:
(1) the Company's Annual Report on Form 10-K and all amendments
thereto for the fiscal year ended September 30, 1997;
(2) the description of the Common Stock set forth in the
Registration Statement on Form 8-A, filed with the
Commission on May 23, 1996, including any amendment or
report filed for the purpose of updating such description;
and
(3) all documents filed by the Company with the Commission
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the
Exchange Act subsequent to the date of this Prospectus and
prior to the termination of this offering of the Shares,
from the date of filing of such documents.
Any statement contained in a previously filed document incorporated by
reference shall be deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained herein or in any
accompanying Prospectus supplement, or in any other subsequently filed
document which also is or is deemed to be incorporated by reference,
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company undertakes to provide without charge to each person to
whom this Prospectus is delivered, upon written or oral request of such
person, a copy of any or all documents incorporated herein by reference,
other than exhibits. All requests for copies of such documents should be
directed to: Michael B. Perrine, Secretary, Treasurer and Chief Financial
Officer, Travis Boats & Motors, Inc., 5000 Plaza on the Lake, Suite 250,
Austin, Texas 78746, telephone: (512) 347-8787.
THE COMPANY
Travis Boats & Motors, Inc. ("Travis Boats" or the "Company") is a
leading multi-state superstore retailer of recreational boats, motors,
trailers and related marine accessories in the southern United States. The
Company, which currently operates 21 stores under the name Travis Boating
Center in Texas, Arkansas, Louisiana, Alabama, Tennessee, Mississippi,
Florida and Georgia, differentiates itself from competitors by providing
customers a unique superstore shopping experience that showcases a broad
selection of high quality boats, motors, trailers and related marine
accessories at firm, clearly posted low prices. Each superstore also
offers complete customer service and support, including in-house financing
programs and full-service repair facilities staffed by factory-trained
mechanics.
Travis Boats was incorporated as a Texas corporation in 1979. Since
its founding as a single retail store in Austin, Texas, the Company has
grown both through acquisitions and the establishment of new store
locations. During the 1980's, the Company expanded into San Antonio, Texas
with the construction of a new store facility. The Company subsequently
made acquisitions of boat retailers operating within the Texas markets of
Midland, Dallas and Abilene. It was during this initial period of
expansion that the Company began developing the systems necessary to manage
a multi-store operation and leveraging the economies of scale associated
with volume purchasing. The Company's success in these areas led to the
proprietary Travis Edition packaging concept and the Company's pricing
philosophy. Since 1990, Travis Boats has opened or acquired 15 additional
store locations in the following states: Texas (3), Arkansas (2), Louisiana
(3), Alabama (2), Tennessee (2), Mississippi (1), Florida (2) and Georgia
(1).
Included in the new store acquisitions are the following transactions:
Effective September 20, 1995, the Company acquired substantially all
of the assets of Red River Marine, Inc., which operated store locations in
the resort communities of Hot Springs and Heber Springs, Arkansas.
Effective December 1, 1995, the Company acquired substantially all of
the assets of Clay's Boats & Motors, Inc., which operated a single store
location in New Iberia, Louisiana.
Effective October 3, 1996, the Company acquired substantially all of
the assets of North Alabama Watersports, which operated a single store
location in Florence, Alabama.
Effective November 1, 1996, the Company acquired substantially all of
the assets of Tri-Lakes Marine, Inc., which operated store locations in
Winchester, Tennessee and Huntsville, Alabama.
Effective February 19, 1997, the Company acquired substantially all of
the assets of Bent's Marine, Inc., which operated a single store location
in Metairie, Louisiana.
Effective August 1, 1997, the Company acquired selected assets from
McLeod Marine, Inc. of Pascagoula, Mississippi.
Effective September 30, 1997, the Company acquired all of the
outstanding stock of Adventure Marine and Outdoors, Inc., Adventure Marine
South, Inc., and Adventure Boat Brokerage, Inc. which collectively
operated a store location in Fort Walton Beach, Florida and a store
location in Key Largo, Florida.
Effective November 20, 1997, the Company acquired substantially all of
the assets of Southeastern Marine Group, Inc., which operated a single
store location in Hendersonville, Tennessee.
Effective December 15, 1997, the Company acquired selected assets from
Worthen Marine of Roswell, Georgia.
The Company sells approximately 50 different models of brand-name
fishing, water-skiing and general recreational boats, along with motors,
trailers, accessories and related equipment. Personal watercraft, off-
shore fishing boats and cabin cruisers are also offered for sale at
selected store locations. During fiscal 1997, substantially all of the
boats sold range in size from 16 to 23 feet at prices ranging from $7,500
to $23,000 with gross profit margins between approximately 21% and 23%.
Approximately 4.5% of new boat sales are personal watercraft with retail
prices generally ranging from $5,000 to $10,000 and approximately 3.2% of
new boat sales are off-shore fishing boats and cruisers with lengths of 27
feet or greater and ranging in retail price from $50,000 to $300,000.
The Company custom designs and pre-packages combinations of popular
brand-name boats, such as Larson, Sprint, Pro-Line and Sea Ark boats with
Johnson outboard and other motors, trailers and numerous accessories, under
its proprietary Travis Edition product line. These signature Travis
Edition packages, which account for the vast majority of total new boat
sales, have been designed and developed in coordination with the
manufacturers and often include distinguishing features and accessories
that have historically been unavailable to, or listed as optional by, many
competitors. These factors enable the Company to provide the customer with
an exceptional product that is conveniently packaged for immediate
enjoyment and competitively priced.
The Company believes that it offers a selection of boat, motor and
trailer packages that fall within the price range of the majority of all
boats, motors and trailers sold in the United States. The Company's
product line generally consists of boat packages priced from $7,500 to -
$23,000 with approximate even distribution within this price range. As the
Company continues to operate in Florida and enters other coastal type
markets along the Gulf of Mexico or the Atlantic coast, management believes
that the distribution of off-shore fishing boats and cabin cruisers will
increase as a percentage of net sales. Management believes that by
combining flexible financing arrangements with an even distribution of
products through a broad price range, the Company is able to offer boat
packages to customers with different purchasing budgets and varying income
levels.
<PAGE>
RISK FACTORS
This Prospectus includes "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. All statements other than statements of
historical information provided herein are forward-looking and may contain
information about financial results, economic conditions, trends and known
uncertainties. The Company cautions the reader that actual results could
differ materially from those expected by the Company, depending on the
outcome of certain factors, including, without limitation, the risk factors
discussed in this section. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as of the
date hereof. The Company undertakes no obligation to release publicly the
result of any revisions to these forward-looking statements which may be
made to reflect events or circumstances after the date hereof, including,
without limitation, changes in the Company's business strategy or planned
capital expenditures, or to reflect the occurrence of unanticipated events.
Impact of Seasonality and Weather on Operations. The Company's
business, as well as the entire recreational boating industry, is highly
seasonal. Strong sales typically begin in January with the onset of the
public boat and recreation shows, and continue through July. Over the
previous four-year period, the average net sales for the quarterly periods
ended March 31 and June 30 represented in excess of 28% and 37%,
respectively, of the Company's average annual net sales. If, for any
reason, the Company's sales were to be substantially below those normally
expected during these periods, the Company's business, financial condition
and results of operations would he materially and adversely affected. The
Company generally realizes significantly lower sales in the quarterly
period ending December 31, resulting in operating losses during that
quarter.
The Company's business is also significantly affected by weather
patterns which may adversely impact the Company's operating results. For
example, drought conditions or merely reduced rainfall levels, as well as
excessive rain, may force area lakes to close or render boating dangerous
or inconvenient, thereby curtailing customer demand for the Company's
products. In addition, unseasonably cool weather and prolonged winter
conditions may lead to a shorter selling season in certain locations.
Although the Company's geographic expansion has reduced, and is expected to
continue to reduce, the overall impact on the Company of adverse weather
conditions in any one market area, such conditions will continue to
represent potential, material adverse risks to the Company and its future
financial performance. Due to the foregoing factors, among others, the
Company's operating results in some future quarters may be below the
expectations of stock market analysts and investors. In such event, there
could be an immediate and significant adverse effect on the trading price
of the Common Stock.
Impact of General Economic Conditions and Discretionary Consumer
Spending. The Company's operations are dependent upon a number of factors
relating to or affecting consumer spending. The Company's operations may
be adversely affected by unfavorable local, regional or national economic
developments or uncertainties regarding future economic prospects that
reduce consumer spending in the markets served by the Company's stores.
Consumer spending on non-essential goods such as recreational boats can
also be adversely affected due to declines in consumer confidence levels,
even if prevailing economic conditions are positive. In an economic
downturn, consumer discretionary spending levels are also reduced, often
resulting in disproportionately large declines in the sale of high-dollar
items such as recreational boats. For example, during the Company's 1988-
1990 fiscal years, the Texas economy was severely depressed due to declines
in the financial, oil and gas and real estate markets. While the Company
remained profitable during these periods, its operating performance
declined. There can be no assurance that a similar economic downturn might
not recur in Texas or any other market or that the Company could remain
profitable during any such period. Similarly, rising interest rates could
have a negative impact on consumers' ability or willingness to obtain
financing from third-party lenders, which could also adversely affect the
ability of the Company to sell its products. Changes in federal and state
tax laws including, without limitation, the imposition or proposed adoption
of luxury or similar taxes on certain consumer products, could also
influence consumers' decisions to purchase products offered by the Company
and could have a negative effect on the Company's sales. Local influences
such as corporate downsizing, military base closings and the Mexican peso
devaluation have adversely affected and may continue to influence the
Company's operations in certain markets.
Dependence Upon Expansion. A significant portion of the Company's
growth has resulted from, and will continue to be increasingly dependent
upon, the addition of new stores and continued sales and profitability from
existing stores. Since October 1991, at which time the Company operated
five stores in Texas, the Company has opened or acquired 16 new store
locations in Texas, Arkansas, Louisiana, Alabama, Tennessee, Mississippi,
and Florida. During fiscal years 1997 and 1996, the stores added since
October 1991 have collectively accounted for approximately 70.6% and 57.6%,
respectively, of the Company's aggregate net sales. Comparable store sales
increased 5.7% and 4.3% in fiscal years 1997 and 1996, respectively.
Recent rates of comparable store sales and net income growth are not
necessarily indicative of the comparable store performance that may be
achieved by the Company in the foreseeable future.
The Company intends to continue to pursue a strategy of growth into
new markets through acquiring existing boat retailers, converting
compatible facilities to Travis Boating Centers and building new store
facilities. Accomplishing these goals for expansion will depend upon a
number of general factors, including the identification of new markets in
which the Company can obtain approval to sell its existing or substantially
similar product lines, the Company's financial capabilities, the hiring,
training and retention of qualified personnel and the timely integration of
new stores into existing operations. The acquisition strategy will further
depend upon the Company's ability to locate suitable acquisition candidates
at a reasonable cost and to dispose, timely and effectively, of the
acquired entity's remaining inventory, as well as the ability of the
Company to sell its Travis Edition product line to the customer base of the
previous owner. There can be no assurance that the Company can identify
suitable acquisition candidates or complete acquisitions on terms and
conditions favorable to the Company.
The strategy of growth through conversion of compatible facilities to
Travis Boating Centers or the construction of new Travis Boating Centers
will further depend upon the Company's ability (i) to locate and construct
suitable facilities at a reasonable cost in those new markets in which the
Company believes it can obtain adequate market penetration at standard
operating margins without the acquisition of an existing dealer, (ii) to
obtain the reliable data necessary to determine the size and product
preferences of such potential markets and (iii) to introduce successfully
its Travis Edition line. There can be no assurance that the Company will
be able to open and operate new stores on a timely or profitable basis.
Moreover, the costs associated with opening such stores may adversely
affect the Company's profitability.
Management of Growth. The Company has undergone a period of rapid
growth. Management has expended and expects to continue to expend
significant time and effort in acquiring and opening new stores. There can
he no assurance that the Company's systems, procedures and controls will be
adequate to support the Company's expanding operations. The inability of
the Company to manage its growth properly could have a material adverse
effect on the Company's business, financial condition and results of
operations.
The Company's management information system is designed to improve
its ability to monitor and manage its geographically dispersed stores.
This system is operational in 19 of the Company's 21 stores, with the most
recently acquired stores planned to be operational during fiscal 1998.
There can be no assurance that the system will function as planned or
that the system can be integrated smoothly with new store openings and
acquisitions.
The Company's planned growth will also impose significant added
responsibilities on members of senior management, including the need to
identify, recruit and integrate new senior level managers, and the ability
to maintain or expand Travis Edition's and Travis Boating Center's
successful appeal to consumers. There is no assurance that any additions
to management can be readily and successfully achieved or that the Company
will be able to continue to grow its business.
Reliance on Manufacturers and Other Key Vendors. The Company's
success is dependent upon its relationship with, and favorable pricing
arrangements from, a limited number of major manufacturers. In the event
these arrangements were to change or terminate for any reason, including
changes in competitive, regulatory or marketing practices, the Company's
business, financial condition and results of operations could be adversely
affected.
As is typical in the industry, the Company deals with each of its
manufacturers pursuant to an annually renewable, non-exclusive, dealer
agreement that does not contain any contractual provisions concerning
product pricing or required purchasing levels. Pricing is generally
established on a model year basis, but is subject to change at the
manufacturer's sole discretion.
The Company purchased approximately 100% of its new outboard motors
for use on its Travis Edition lines of recreational boats in fiscal years
1997 and 1996, respectively, from Outboard Marine Corporation ("OMC"), the
manufacturer of Johnson outboard motors. Unlike the Company's other dealer
agreements, the Company's agreement with OMC is multi-year in nature. The
current agreement, which is in the first of five years, sets forth an
established discount level from the then prevailing dealer net price over
the entire term of the agreement. This dealer agreement may be canceled by
either party if the volume of product purchased or available to be
purchased is not maintained at pre-established levels. If the Company's
contract with OMC were canceled or modified, it could have a material
adverse effect on the Company's business, financial condition and results
of operations.
Approximately 34.3% and 22.7% of the Company's net inventory
purchases in fiscal years 1997 and 1996, respectively, were from a single
boat supplier. The Company also currently purchases a high percentage of
the annual production of a limited number of boat manufacturers. To ensure
adequate inventory levels to support the Company's expansion, it may be
necessary for such manufacturers to increase production levels or allocate
a greater percentage of their production to the Company. In the event that
the operations of the Company's manufacturers were interrupted or
discontinued, the Company could experience temporary inventory shortfalls,
or disruptions or delays with respect to any unfilled purchase orders then
outstanding. Although the Company believes that adequate alternate sources
would be available that could replace a manufacturer as a product resource,
there can be no assurance that such alternate sources will be available at
the time of any such interruption or that alternative products will be
available at comparable quality and prices. The unanticipated failure of
any manufacturer or supplier to meet the Company's requirements with regard
to volume or design specifications, the Company's inability to locate
acceptable alternative manufacturers-or suppliers, the Company's failure to
have dealer agreements renewed or to meet certain volume requirements with
regard to purchasing, or any substantial increase in the manufacturer's
pricing to the Company, could have a material adverse effect on the
Company's business, financial condition and results of operations.
Limitations to Market Entry. Under certain of its dealer agreements,
the Company must obtain permission from its manufacturers to sell products
in new markets. While the Company has received permission to sell Johnson
motors and various boat lines in its immediate expansion markets,
manufacturers have not granted such permission to the Company in each of
its broader target markets. While the Company believes it can sell
products of other manufacturers in new markets, there can be no assurance
that all of the Company's current manufacturers will grant permission for
the Company to sell in new markets, or if unable to obtain such permission,
that the Company can obtain suitable alternative sources of supply.
Unlike other states the Company has targeted for expansion, the State
of Oklahoma has had restrictions on the location of competing marine
dealers that limit the ability of new entrants in the retail boat industry
to compete in Oklahoma. There can be no assurance that other states will
not pass similar or other restrictions limiting new competition.
Income from Financing, Insurance and Extended Service Contracts. A
substantial portion of the Company's income results from the origination
and placement of customer financing and the sale of insurance products and
extended service contracts (collectively, "F&I Products"), the most
significant component of which is the income resulting from the Company's
origination of customer financing. For example, during fiscal years 1997
and 1996, respectively, F&I Products accounted for approximately 4.4% and
4.2% of net sales and approximately 16.7% and 16.5% of gross profit. The
Company's lenders may choose to pursue this business directly, rather than
through intermediaries such as the Company. Moreover, lenders may impose
terms in their boat financing arrangements with the Company that may be
materially unfavorable to the Company or its customers. For these and
other reasons, the Company could experience a significant reduction in
income resulting from reduced demand for its customer financing programs.
In addition, if profit margins are reduced on sales of F&I Products, or if
these products are no longer available, it would have a material adverse
effect on the Company's business, financial condition and results of
operations. Furthermore, although optional extended service contracts sold
by the Company are from third party providers that have further reinsured
their warranty exposure and the Company has never experienced any claims
due to the default of a third party extended service contract provider, the
Company may experience significant breach of warranty claims as a result of
the failure of a third party extended service contract provider or
reinsurers that may, in the aggregate, be material to the Company's
business.
Availability of Financing. The Company currently has significant
floor plan and other inventory lines of credit from financial institutions
and other lenders, which the Company believes reflect competitive terms and
conditions. While the Company believes it will continue to obtain
comparable financing from these or other lenders, there can be no assurance
that such financing will be available to the Company. The failure to
obtain sufficient financing on favorable terms and conditions could have a
material adverse effect on the business, financial condition and results of
operations of the Company.
Dependence on Key Personnel. The Company believes its success
depends, in large part, upon the continued services of key management
personnel, including Mark T. Walton, Chairman of the Board and President;
Ronnie L. Spradling, Executive Vice President-New Store Development; and
Michael B. Perrine, Chief Financial Officer, Secretary and Treasurer; and
other key employees. Although the Company has employment agreements
through TBC Management, Ltd. (an affiliated partnership of the Company)
with each of Messrs. Walton, Spradling and Perrine expiring in June 1999,
the loss of any of these individuals could materially and adversely affect
the Company, including its business expansion plans. The Company maintains
and is the beneficiary of key-man life insurance policies on Messrs.
Walton and Perrine in the amount of $1.0 million each, and on Mr. Spradling
in the amount of $500,000.
Product and Service Liability Risks. Products sold or serviced by
the Company may expose it to potential liability for personal injury or
property damage claims relating to the use of those products.
Additionally, as a result of the Company's activities in custom packaging
its Travis Edition lines, the Company may be included as a defendant in
product liability claims relating to defects in manufacture or design.
Historically, the resolution of product liability claims has not materially
affected the Company's business. The Company generally requires
manufacturers from which it purchases products to supply proof of product
liability insurance. Although the Company maintains third party product
liability insurance that it believes to be adequate, there can be no
assurance that the Company will not experience legal claims in excess of
its insurance coverage, or claims that are ultimately not covered by
insurance. Furthermore, if any significant claims are made against the
Company, the Company's business, financial condition and results of
operations may be adversely affected by related negative publicity.
Volatility of Stock Price. Prior to the Company's initial public
offering in June 1996, there was no public trading market for the Company's
Common Stock. There can be no assurance of an ongoing active trading
market or that the market price of the Common Stock will not decline. It
is anticipated that there will be limited float in the market due to the
relatively low number of shares owned by the public and consequently,
fluctuations in the market price for the Common Stock could be significant.
Recent market conditions for newly public companies, as well as the
Company's quarterly variations in operating results due to seasonality and
other factors, are likely to result in significant fluctuations in the
market price for the Common Stock. Future announcements concerning the
Company or its competitors, including government regulations, litigation or
changes in earnings estimates or descriptive materials published by
analysts, may also cause the market price of the Common Stock to fluctuate
substantially. These fluctuations, as well as general economic, political
and market conditions, such as recessions, may adversely affect the market
price of the Common Stock.
Shares Eligible for Future Sale. Sales of substantial amounts of the
Company's Common Stock in the public market, or the perception that such
sales may occur, could have a material adverse effect on the market price
of the Common Stock. As of December 18, 1997, the Company, its officers
and directors and certain stockholders, beneficially own or control voting
rights, in the aggregate, on approximately 1,619,557 shares of Common
Stock. No prediction can be made as to the effect, if any, that future
sales of shares, or the availability of shares for future sale will have on
the market price of the Common Stock prevailing from time to time.
Anti-takeover Effect of Articles and Bylaw Provisions. The Company's
Articles of Incorporation provide that up to 1,000,000 shares of preferred
stock may be issued by the Company from time to time in one or more series.
The Board of Directors is authorized to determine the rights, preferences,
privileges and restrictions granted to and imposed upon any unissued series
of preferred stock and to fix the number of shares of any series of
preferred stock and the designation of any such series, without any vote or
action by the Company's stockholders. The Board of Directors may authorize
and issue preferred stock with voting or conversion rights that could
adversely affect the voting power or other rights of the holders of Common
Stock. In addition, the issuance of preferred stock could have the effect
of delaying, deferring or preventing a change in control of the Company.
The Company's Articles of Incorporation also allow the Board of Directors
to fix the number of directors in the Bylaws with no minimum or maximum
number of directors required. The Company's Bylaws currently provide that
the Board of Directors shall be divided into three classes of two or three
directors each, with each class elected for three-year terms expiring in
successive years. The effect of these provisions may be to delay or
prevent a tender offer or takeover attempt that a stockholder might
consider to be in the stockholder's best interest, including attempts that
might result in a premium over the market price for the shares held by the
stockholders.
<PAGE>
SELLING SHAREHOLDERS
The following table sets forth information, as of January 1, 1998,
regarding the Selling Shareholders, their recent relationships with the
Company and its affiliates, their ownership of Common Stock before and
after this offering, and the number of Shares to be offered for the account
of each.
Number of
Material Shares to
relationships with Amount of be offered Amount of
Company or Common Stock for Selling Common Stock
Selling affiliates since owned at Shareholder's owned after
Shareholder January 1994 January 1, 1998 Account offering(1)(2)
- ----------- ----------------- --------------- ------------- --------------
Frederic L. none 2,147 2,147 0
Pace
John. W. none 86,154 86,154 0
Reinhold
Kevin T. none 3,604 3,604 0
Knight
(1) Assumes that all Shares are sold pursuant to this offering and that
no additional Common Stock is sold or acquired by Selling
Shareholders.
(2) In each case, represents less than 1% of issued and outstanding
Common Stock.
PLAN OF DISTRIBUTION
The Company has been advised by the Selling Shareholders that all or
a portion of the Shares may be sold from time to time (i) on the Nasdaq
National Market at prevailing market prices, (ii) otherwise than on such
market at prevailing market prices or negotiated prices, or (iii) by a
combination of the foregoing methods of sale. The Company will receive no
portion of the proceeds of any sales of Shares by the Selling Shareholders,
but will bear all expenses of registering the Shares under the Securities
Act, except as provided below.
Pursuant to the terms of that Registration Rights Agreement dated
November 1, 1995 between the Company and the Selling Shareholders (or their
predecessors in interest) (the "Registration Rights Agreement"), the
Company has agreed to file the Registration Statement of which this
Prospectus forms a part for the purpose of registering the potential resale
of the Shares and to maintain the effectiveness of such Registration
Statement for three years, as contemplated by the Registration Rights
Agreement. In addition, the Company and the Selling Shareholders listed
therein agreed to indemnify each other and certain affiliated parties from
and against any losses or claims arising out of, among other things, (1)
any untrue statement of a material fact or (2) any material omission
contained or referred to in the Registration Statement. Insofar as
indemnification for liabilities arising under the Securities Act may be
permitted to directors, officers or persons controlling the Company,
pursuant to the foregoing provisions, the Company 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.
Except as specifically set forth herein, none of the Selling
Shareholders has, or within the past three years has had, any position,
office or other material relationship with the Company or any of its
predecessors or affiliates.
The Company has been advised by the Selling Shareholders that they
(or, subject to applicable law, their pledgees, donees, distributees,
transferees or other successors in interest) intend to sell all or a
portion of the Shares offered by this Prospectus from time to time (i) on
the Nasdaq National Market, (ii) otherwise than on the Nasdaq National
Market, in negotiated transactions at fixed prices which may be changed, at
market prices prevailing at the time of sale or at prices reasonably
related thereto or at negotiated prices, or (iii) by a combination of the
foregoing methods of sale (any of which may involve crosses and block
transactions). The Selling Shareholders may effect such transactions by
selling the Shares to or through broker-dealers, and such broker-dealers
may receive compensation in the form of discounts, concessions or
commissions from the Selling Shareholders and/or the purchasers of the
Shares for which such broker-dealers may act as agent or to whom they may
sell as principal, or both. The Company is not aware as of the date of
this Prospectus of any agreements between any of the Selling Shareholders
and any broker-dealers with respect to the sale of the Shares offered by
this Prospectus. In connection with distributions of the Shares or
otherwise, the Selling Shareholders may enter into hedging transactions
with broker-dealers. In connection with such transactions, broker-dealers
may engage in short sales of the Shares registered hereunder in the course
of hedging the positions they assume with Selling Shareholders. The
Selling Shareholders may also sell Shares short and deliver the Shares to
close out such short positions. The Selling Shareholders may also enter
into option or other transactions with broker-dealers which require the
delivery to the broker-dealer of the Shares registered hereunder, which the
broker-dealer may resell pursuant to this Prospectus. The Selling
Shareholders may also pledge the Shares registered hereunder to a broker or
dealer and upon a default, the broker or dealer may effect sales of the
pledged Shares pursuant to this Prospectus.
The Selling Shareholders and any broker, dealer or other agent
executing sell orders on behalf of the Selling Shareholders may be deemed
to be "underwriters" within the meaning of the Securities Act, in which
event commissions received by any such broker, dealer or agent and profit
on any resale of the Shares may be deemed to be underwriting commissions
under the Securities Act. Such commissions received by a broker, dealer or
agent may be in excess of customary compensation. The Shares may also be
sold in accordance with Section 4(1) of the Securities Act or Rule 144 and
Rule 145 under the Securities Act.
Information as to whether underwriters who may be selected by the
Selling Shareholders, or any other broker-dealer, is acting as principal or
agent for the Selling Shareholders, the compensation to be received by
underwriters who may be selected by the Selling Shareholders, or any
broker-dealer, acting as principal or agent for the Selling Shareholders
and the compensation to be received by other broker-dealers, will, to the
extent required, be set forth in a supplement to this Prospectus (the
"Prospectus Supplement"). Any dealer or broker participating in any
distribution of the Shares may be required to deliver a copy of this
Prospectus, including the Prospectus Supplement, if any, to any person who
purchases any of the Shares from or through such dealer or broker.
All expenses of registration incurred in connection with the offering
will be borne by the Company. All selling and other expenses incurred by
the Selling Shareholders will be borne by the Selling Shareholders.
The Selling Shareholders will be subject to applicable provisions of
the Exchange Act and the rules and regulations thereunder, including
without limitation, Rule 102 under Regulation M, which provisions may limit
the timing of purchases and sales of any of the Common Stock by the Selling
Shareholders. Rule 102 under Regulation M provides, with certain
exceptions, that it is unlawful for a selling shareholder or its affiliated
purchaser to, directly or indirectly, bid for or purchase or attempt to
induce any person to bid for or purchase, for an account in which the
selling shareholder or affiliated purchaser has a beneficial interest in
any securities that are the subject of the distribution during the
applicable restricted period under Regulation M. All of the foregoing may
affect the marketability of the Common Stock. The Company will require
each Selling Shareholder and his or her broker if applicable, to provide a
letter that acknowledges his compliance with Regulation M under the
Exchange Act before authorizing the transfer of such Selling Shareholder's
Shares.
It is anticipated that the Selling Shareholders may offer all of the
Shares for sale. Further, because it is possible that a significant number
of Shares could be sold at the same time hereunder, such sales, or the
possibility thereof, may have a depressive effect on the market price of
the Company's Common Stock.
LEGAL MATTERS
The validity of the Shares offered hereby will be passed upon for the
Company by Jenkens & Gilchrist, A Professional Corporation, Austin, Texas.
EXPERTS
The consolidated financial statements of Travis Boats & Motors, Inc.
appearing in the Company's Annual Report (Form 10-K) for the year ended
September 30, 1997, have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon included therein and
incorporated herein by reference. Such consolidated financial statements
are incorporated herein by reference in reliance upon such report given
upon the authority of such firm as experts in accounting and auditing.
<PAGE>
___________________________________
___________________________________
No dealer, salesman, or other
person has been authorized to give
any information or to make any
representations other than those 91,905 Shares
contained in this Prospectus and,
if given or made, such information
or representations must not be
relied upon as having been TRAVIS BOATS & MOTORS, INC.
authorized by the Company or the
Selling Shareholders. This
Prospectus does not constitute an
offer to sell or a solicitation of
an offer to buy any securities Common Stock
other than the Shares nor does it
constitute an offer or solicitation
by anyone in any jurisdiction in
which such offer or solicitation
would be unlawful or to any person
to whom it is unlawful to make such
offer or solicitation. Neither the
delivery of this Prospectus nor any
offer or sale made hereunder at any
time shall imply that information
herein is correct as of any time
subsequent to the date hereof.
_______________
TABLE OF CONTENTS
----------------
Available Information.............2
Incorporation of Certain PROSPECTUS
Documents by Reference..........2
The Company.......................3 ----------------
Risk Factors......................5
Selling Shareholders.............10
Plan of Distribution.............10 February 11, 1998
Legal Matters....................12
Experts..........................12
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The estimated expenses in connection with the issuance and
distribution of the securities being registered, all of which will be borne
by the Company, are set forth in the following itemized table:
SEC Registration Fee.....................................$636
Transfer Agent's Fees.....................................500
Blue Sky Fees and Expenses................................500
Accounting Fees.........................................2,500
Legal Fees..............................................3,000
Miscellaneous.............................................500
Total..............................................$7,636
Item 15. Indemnification of Directors and Officers
The Company has authority under Articles 2.02A.(16) and 2.02-1 of the
Texas Business Corporation Act (the "TBCA") to indemnify its directors and
officers to the extent provided for in such statute. The Company's
articles of incorporation permit indemnification of directors and officers
to the fullest extent permitted by the TBCA.
The TBCA provides in part that a corporation may indemnify a director
or officer or other person who was, is, or is threatened to be made a named
defendant or respondent in a proceeding because the person is or was a
director, officer, employee or agent of the corporation, if it is
determined that (i) such person conducted himself in good faith; (ii)
reasonably believed, in the case of conduct in his official capacity as a
director or officer of the corporation, that his conduct was in the
corporation's best interests, and, in all other cases, that his conduct was
at least not opposed to the corporation's best interest; and (iii) in the
case of any criminal proceeding, had no reasonable cause to believe that
his conduct was unlawful.
A corporation may indemnify a person under the TBCA against judgments,
penalties (including excise and similar taxes), fines, settlement, and
reasonable expenses actually incurred by the person in connection with the
proceeding. If the person is found liable to the corporation or is found
liable on the basis that personal benefit was improperly received by the
person, the indemnification is limited to reasonable expenses actually
incurred by the person in connection with the proceeding, and shall not be
made in respect of any proceeding in which the person shall have been found
liable for willful or intentional misconduct in the performance of his duty
to the corporation.
A corporation may also pay or reimburse expenses incurred by a person
in connection with his appearance as a witness or other participation in a
proceeding at a time when he is not a named defendant or respondent in the
proceeding.
Additionally, the Company's articles of incorporation limit or
eliminate a director's liability for monetary damages to the Company or its
shareholders for acts or omissions in the director's capacity as a
director, except that the articles of incorporation do not eliminate the
liability of a director for (i) a breach of the director's duty of loyalty
to the Company or its shareholders, (ii) an act or omission not in good
faith that constitutes a breach of duty of the director to the Company or
an act or omission that involves intentional misconduct or a knowing
violation of the law, (iii) a transaction from which a director received an
improper benefit, whether or not the benefit resulted from an action taken
within the scope of the director's office, or (iv) an act or omission for
which the liability of a director is expressly provided for by an
applicable statute.
Item 16. Exhibits.
4 Specimen share certificates (incorporated by reference to
the Company's Registration Statement No. 333-003283 on Form
S-1 filed on May 23, 1996)
5 Opinion of Jenkens & Gilchrist, A Professional Corporation,
regarding legality
23.1 Consent of Jenkens & Gilchrist, A Professional Corporation
(contained in its opinion filed as Exhibit 5)
23.2 Consent of Ernst & Young LLP (contained in Part II of this
Registration Statement)
25 Power of Attorney (included on the signature pages hereof)
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 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;
(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; and
(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 Section 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be
deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
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 provisions
described under Item 15 above, 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 and will be governed by the final adjudication
of such issue.
<PAGE>
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 Austin, State of Texas, on
February 1, 1998.
TRAVIS BOATS & MOTORS, INC.
By: /s/ Mark T. Walton
Mark T. Walton,
Chairman of the Board and President
Each person whose signature appears below hereby constitutes and
appoints Mark T. Walton and Michael B. Perrine, and each of them, each with
full power to act without the other, his true and lawful attorneys-in-fact
and agents, each with full power of substitution and resubstitution for him
and in his name, place and stead, in any and all capacities, to sign any or
all amendments to this Registration Statement (including post-effective
amendments), and to file the same with all exhibits thereto and other
documents in connection therewith, with the Securities and Exchange
Commission, granting unto each of said attorneys-in-fact and agents full
power and authority to do and perform each and every act and thing
requisite and necessary to be done in connection therewith, as fully to all
intents and purposes as he might or could do in person hereby ratifying and
confirming that each of said attorneys-in-fact and agents or his
substitutes may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below in multiple counterparts with the effect of
one original by the following persons in the capacities and on the dates
indicated.
Signature Title Date
/s/ Mark T. Walton Chairman of the Board and February 1, 1998
Mark T. Walton President,
(Principal Executive Officer)
/s/ Michael B. Perrine Chief Financial Officer, February 1, 1998
Michael B. Perrine Treasurer and Secretary
(Principal Financial and
Accounting Officer)
/s/ Ronnie L. Spradling Director and Executive Vice February 1, 1998
Ronnie L. Spradling President - New Store
Development
/s/ E. D. Bohls Director February 1, 1998
E. D. Bohls
/s/ Joseph E. Simpson Director Feburary 1, 1998
Joseph E. Simpson
/s/ Robert C. Siddons Director February 1, 1998
Robert C. Siddons
/s/ Steven W. Guarasich, Jr. Director February 1, 1998
Steven W. Gurasich, Jr.
/s/ Zach McClendon, Jr. Director February 1, 1998
Zach McClendon, Jr.
<PAGE>
Exhibit 5
Jenkens & Gilchrist
A PROFESSIONAL CORPORATION
2200 ONE AMERICAN CENTER
600 CONGRESS AVENUE
AUSTIN, TEXAS 78701
(512) 499-3800
TELECOPIER (512) 404-3520
DALLAS, TEXAS
(214) 855-4500
HOUSTON, TEXAS
(713) 951-3300
LOS ANGELES, CALIFORNIA
(310) 820-8800
SAN ANTONIO, TEXAS
(210) 246-5000
WASHINGTON, D.C.
(212) 326-1500
WRITER'S DIRECT DIAL NUMBER
J. Rowland Cook
(512) 499-3821
February 11, 1998
Travis Boats & Motors, Inc.
500 Plaza on the Lake
Suite 250
Austin, Texas 78746
Re: Travis Boats & Motors, Inc.
Registration Statement on Form S-3
Ladies and Gentlemen:
On February 11, 1998, Travis Boats & Motors, Inc., a Texas corporation
(the "Company"), filed with the Securities and Exchange Commission
("Commission") a Registration Statement on Form S-3 (the "Registration
Statement"), under the Securities Act of 1933, as amended (the "Act"),
relating to the offer and sale by the certain shareholders of the Company
(the "Selling Shareholders") of an aggregate of 91,905 shares of common
stock, $.01 par value per share (the "Shares"). We have acted as counsel
to the Company in connection with the preparation and filing of the
Registration Statement.
In connection therewith, we have examined and relied upon the original
or copies, certified to our satisfaction, of (i) the Articles of
Incorporation and the Bylaws of the Company, in each case as amended to
date, (ii) copies of resolutions of the Board of Directors of the Company
authorizing the offering and the issuance of the shares to be sold by the
Company and related matters, (iii) the Registration Statement, and all
exhibits thereto, and (iv) such other documents and instruments as we have
deemed necessary for the expression of opinions herein contained. In
making the foregoing examinations, we have assumed the genuineness of all
signatures and the authenticity of all documents submitted to us as
originals, and the conformity to original documents of all documents
submitted to us as certified or photostatic copies. As to various
questions of fact material to this opinion, we have relied, to the extent
we deem reasonably appropriate, upon representations or certificates of
officers or directors of the Company and upon documents, records and
instruments furnished to us by the Company, without independent check or
verification of their accuracy.
Based upon the foregoing examination, we are of the opinion that the
Shares have been duly and validly authorized and are legally issued, fully
paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the use of our name under the caption "Legal
Matters" in the Prospectus forming a part of the Registration Statement.
In giving such consent, we do not admit that we come within the category
of persons whose consent is required by Section 7 of the Act or the rules
and regulations of the Commission thereunder.
Respectfully submitted,
JENKENS & GILCHRIST,
A Professional Corporation
By: /s/ J. Rowland Cook
J. Rowland Cook
Authorized Signatory
<PAGE>
Exhibit 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in
the Registration Statement (Form S-3) and related Prospectus of Travis
Boats & Motors, Inc. for the registration of 91,905 shares of its common
stock and to the incorporation by reference therein of our report dated
November 25, 1997, with respect to the consolidated financial statements of
Travis Boats & Motors, Inc. included in its Annual Report (Form 10-K) for
the year ended September 30, 1997, filed with the Securities and Exchange
Commission.
ERNST & YOUNG LLP
Austin, Texas
February 10, 1998
