As filed with the Securities and Exchange Commission on April 24, 2000
Registration Statement No. 333-77059
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------------
POST-EFFECTIVE AMENDMENT NO. 1
FORM S-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
-------------------------
HANDY HARDWARE WHOLESALE, INC.
(Exact name of Registrant as specified in charter)
TEXAS 8300 TEWANTIN DRIVE 74-1381875
(State of Incorporation) HOUSTON, TEXAS 77061 (I.R.S. Employer
(713) 644-1495 Identification No.)
(Address and telephone number of
Registrant's principal executive offices)
-------------------------
JAMES D. TIPTON COPY TO:
PRESIDENT DONALD W. BRODSKY
HANDY HARDWARE WHOLESALE, INC. BO C. CHANDLER
8300 TEWANTIN DRIVE JENKENS & GILCHRIST,
HOUSTON, TEXAS 77061 A PROFESSIONAL CORPORATION
(713) 644-1495 1100 LOUISIANA, SUITE 1800
(Name, address and telephone number HOUSTON, TEXAS 77002
of agent for service)
-------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As
soon as practicable after the effective date of this Registration Statement.
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, check the following box: |X|
If the Registrant elects to deliver its latest annual report to
security holders, or a complete and legible facsimile thereof, pursuant to Item
11(a)(1) of this Form, check the following box: |X|
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 SUCH SECTION 8(A),
MAY DETERMINE.
<PAGE>
HANDY HARDWARE WHOLESALE, INC.
CROSS-REFERENCE SHEET
BETWEEN ITEMS OF FORM S-2 AND THE PROSPECTUS
<TABLE>
<CAPTION>
ITEM NO. PROSPECTUS CAPTION
-------- ------------------
<S> <C>
1. Forepart of the Registration Statement and Outside
Front Cover Page of Prospectus................................................Cover Page
2. Inside Front and Outside Back Cover Pages of
Prospectus....................................................................Table of Contents
3. Summary Information, Risk Factors and Ratio of
Earnings to Fixed Charges.....................................................The Company; The Offering; Ratio of
Earnings to Combined Fixed Charges and
Preferred Stock Dividend Requirements
4. Use of Proceeds...............................................................Cover Page; Use of Proceeds
5. Determination of Offering Price...............................................Determination of Offering Price
6. Dilution......................................................................Inapplicable
7. Selling Security Holders......................................................Inapplicable
8. Plan of Distribution..........................................................Plan of Distribution
9. Description of Securities to be Registered....................................Dividend Policy; Description of Capital
Stock
10. Interests of Named Experts and Counsel........................................Inapplicable
11. Information with Respect to the Registrant....................................Where You Can Find More Information; The
Company; Description of Capital Stock;
Incorporation of Documents by Reference
12. Incorporation of Certain Information by Reference.............................Incorporation of Documents by Reference
13. Disclosure of Commission Position on
Indemnification for Securities Act Liabilities................................Inapplicable
</TABLE>
<PAGE>
PROSPECTUS
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 and it is not soliciting an offer to buy these securities in any state
where the offer or sale is not permitted.
HANDY HARDWARE WHOLESALE, INC.
4,000 Shares of Class A Common Stock
13,000 Shares of Class B Common Stock
18,000 Shares of Preferred Stock
Only member-dealers of Handy Hardware Wholesale, Inc. may purchase the
securities offered by this prospectus. No active trading market exists for any
class of our stock, and we do not anticipate that any trading market will
develop in the future. We are offering these securities without an underwriter.
No sales commission will be paid. Our estimated expenses for this offering total
$23,542. The following table shows a breakdown of the offering:
<TABLE>
<CAPTION>
NUMBER PER SHARE
CLASS OF SECURITIES OF SHARES PRICE TO PUBLIC PROCEEDS TO HANDY
------------------- --------- --------------- -----------------
<S> <C> <C> <C>
Class A Common Stock 4,000 $100 $ 400,000
Class B Common Stock 13,000 $100 $1,300,000
Preferred Stock 18,000 $100 $1,800,000
----------
$3,500,000
==========
</TABLE>
Only holders of Class A Common Stock have voting rights. No dividends
have ever been paid on Class A or Class B Common Stock. The holders of preferred
stock receive a cumulative annual dividend as declared by our board of
directors. This dividend must range from 7-20% of the $100 purchase price per
share of preferred stock and is the only form of return on stock investment in
Handy. Upon liquidation and distribution of our assets, holders of preferred
stock will be paid first, with holders of Class A and Class B Common Stock
sharing ratably in the distribution of the remaining assets.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS
TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
MAY ___, 2000
1
<PAGE>
TABLE OF CONTENTS
Page
----
THE COMPANY....................................................................3
THE OFFERING...................................................................3
USE OF PROCEEDS................................................................3
DIVIDEND POLICY................................................................4
DETERMINATION OF OFFERING PRICE................................................4
RATIO OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDEND REQUIREMENTS...........................5
PLAN OF DISTRIBUTION...........................................................6
DESCRIPTION OF CAPITAL STOCK...................................................8
SUMMARY OF DEALER CONTRACT.....................................................9
LEGAL MATTERS..................................................................9
EXPERTS.......................................................................10
WHERE YOU CAN FIND MORE INFORMATION...........................................10
--------------------
You should rely only on the information contained in this prospectus.
We have not authorized anyone to give you any other information. If you receive
unauthorized information you should not rely on it. We are offering to sell and
seeking offers to buy these securities only in jurisdictions where offers and
sales are permitted. The information contained in this prospectus is accurate
only as of the date of this prospectus.
2
<PAGE>
THE COMPANY
In 1961 thirteen independent hardware dealers formed Handy to provide
warehouse facilities and purchasing services to independent hardware dealers. By
forming Handy, these independent hardware dealers obtained better buying power.
We refer to these independent hardware dealers as our member-dealers. We are
owned entirely by our member-dealers. Each member-dealer signs a dealer contract
in which the member-dealer agrees to buy some or all of its merchandise from us.
In addition, each member-dealer enters into a stock subscription agreement to
purchase our stock. These stock subscriptions provide us with capital. This
prospectus covers stock to be sold to our member-dealers as part of their
purchases of goods. For more detail, see "Plan of Distribution" on page 6. As of
March 1, 2000, our 1,071 member-dealers owned hardware stores in Texas,
Louisiana, Mississippi, Alabama, Florida, Oklahoma, Arkansas, Mexico and Central
America.
To service our member-dealers, we maintain a central warehouse and
office facility in Houston, Texas. In addition, we lease 32 tractor trailers
which haul our 57 enclosed trailers to deliver merchandise to our
member-dealers. We charge member-dealers our cost for merchandise plus a small
markup charge, resulting in a lower price than member-dealers can obtain on
their own. For a more detailed description of operations, see Items 1 and 2 on
pages 1-7 of our 1999 Annual Report on Form 10-K.
THE OFFERING
Securities offered........................ 4,000 shares of Class A Common Stock
13,000 shares of Class B Common Stock
18,000 shares of Preferred Stock
Price of each share offered...............$100
Use of proceeds...........................Expansion of inventory, purchase of
equipment and bulding improvements
USE OF PROCEEDS
We will receive net offering proceeds of up to $3,500,000 from the sale
of these securities. We expect to use proceeds from the offering in the
following manner and priority:
o $2,085,000 for inventory expansion;
o $100,000 for computer upgrades;
o $150,000 for warehouse equipment expansion and upgrades;
o $115,000 for upgrading company cars;
o $50,000 for upgrading office equipment; and
o $1,000,000 for building improvements.
If we receive net offering proceeds of less than $3,500,000, we will use our
working capital to fund the remaining cost of the above projects, and we will
use our third party financing to fund costs related to our building
improvements.
3
<PAGE>
DIVIDEND POLICY
Our Articles of Incorporation require us to pay a dividend on our
outstanding preferred stock. Each year our board declares the dividend amount,
which must range between 7-20% of the amount paid by member-dealers to purchase
their preferred stock. The dividend is paid only to stockholders who own
preferred stock on January 31 of each year. We prorate the dividend paid if a
stockholder has owned preferred stock for less than one year. From year to year
the amount of the preferred stock dividend depends upon our earnings, capital
requirements and financial condition. The table below shows dividends paid over
the past five years on preferred stock as a percentage of the $100 purchase
price per share.
1996 -- 12%
1997 -- 13%
1998 -- 13%
1999 -- 10%
2000 -- 10%
We have never paid a cash dividend on either class of our common stock,
and we do not anticipate doing so in the future. Our goal is to provide our
member-dealers with low cost, quality merchandise to increase the
member-dealers' profits. To do so, we attempt to keep our gross profit from
merchandise sales at a relatively low and constant level. With the exception of
funds needed to pay preferred stock dividends, we traditionally retain all
earnings to finance the development and growth of our business.
DETERMINATION OF OFFERING PRICE
Because no active trading market exists for any class of our stock, we
have always set our stock's offering price at $100 per share, its par value. For
more information regarding the market for our shares, see "Market for
Registrant's Common Equity and Related Stockholder Matters" on page 7 of our
1999 Annual Report on Form 10-K.
To our knowledge, only two forms of secondary trading in our securities
exist. Stock may be transferred from one member-dealer to another, or we may
repurchase shares, at a price of $100 per share, from retiring member-dealers or
from overinvested member-dealers. For more information regarding our repurchase
of shares, see "Note 8 - Stockholders' Equity" on pages 30-31 of our 1999 Annual
Report on Form 10-K and "Plan of Distribution - Repurchases from Overinvested
Member- Dealers" page 7 of this prospectus.
4
<PAGE>
RATIO OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDEND REQUIREMENTS
The following table shows our ratio of earnings to combined fixed
charges and our preferred stock dividend requirements for the last five fiscal
years. For all years presented, our earnings exceeded the combined fixed charges
and preferred stock dividend requirements. "Earnings" include pretax earnings
from continuing operations, to which has been added back fixed charges. "Fixed
charges" include interest expense, the portion of rental expense attributable to
interest, and amortization of debt expense. "Preferred stock dividend
requirements" cover the amount of pre-tax earnings required to pay preferred
stock dividends.
<TABLE>
<CAPTION>
Year Ended December 31
--------------------------------------------------------------------------------
1995 1996 1997 1998 1999
---- ---- ---- ---- ----
EARNINGS
<S> <C> <C> <C> <C> <C>
Pretax Earnings $ 1,568,634 $ 1,857,326 $ 2,169,718 $ 1,387,437 $ 1,543,855
Plus: Fixed Charges 338,758 333,464 197,367 176,769 186,195
----------- ----------- ---------- ----------- -----------
Total Earnings $ 1,907,392 $ 2,190,790 $ 2,367,085 $ 1,564,206 $ 1,730,050
=========== =========== =========== =========== ===========
FIXED CHARGES
Interest Expense 236,743 172,483 42,804 45,273 68,234
Rental Expense 102,015 160,981 154,563 131,496 117,961
Amortization of Debt Expense -0- -0- -0- -0- -0-
----------- ----------- ----------- ----------- -----------
Total Fixed Charges 338,758 333,464 197,367 176,769 186,195
PREFERRED STOCK DIVIDEND
REQUIREMENTS 617,162 792,352 955,095 1,066,200 866,166
----------- ----------- ------------- ----------- -----------
Total Fixed Charges
and Preferred Stock
Dividend
Requirements $ 955,920 $ 1,125,816 $ 1,152,462 $ 1,242,969 $ 1,052,361
=========== =========== =========== =========== ===========
RATIO OF EARNINGS TO COMBINED
FIXED CHARGES AND PREFERRED
STOCK DIVIDEND REQUIREMENTS 2.00 1.95 2.05 1.26 1.64
=========== =========== =========== =========== ===========
</TABLE>
5
<PAGE>
PLAN OF DISTRIBUTION
Only our member-dealers may purchase the securities offered by this
prospectus. We deliver this prospectus to each member-dealer and any potential
member-dealer. We are offering these securities in a continuous offering until
April 30, 2001. We expect to extend this offering after that date until April
30, 2003. All new member-dealers must enter into a stock subscription agreement
to make an initial purchase of our Class A Common Stock, followed by periodic
purchases of our Class B Common Stock and preferred stock.
PURCHASE OF CLASS A COMMON STOCK BY NEW MEMBER-DEALERS
We require each new member-dealer to purchase, for $1,000 cash, 10
shares of Class A Common Stock at $100 per share. We do not permit
member-dealers to purchase more than 10 shares of Class A Common Stock.
PURCHASES OF CLASS B COMMON STOCK AND PREFERRED STOCK BY MEMBER-DEALERS
Collecting Funds from Member-Dealers to Purchase Class B Common
Stock and Preferred Stock.
We prepare a semi-monthly statement for each member-dealer stating
that member-dealer's total merchandise purchases made during the preceding half
month. Total merchandise purchases include both the member-dealer's warehouse
purchases from our inventory and that member-dealer's purchases directly from
the manufacturer that are billed through us. An additional charge equal to 2% of
the member-dealer's warehouse purchases is invoiced on each statement. We
accumulate the funds from this 2% charge for each member-dealer to use for its
purchase of Class B Common Stock and preferred stock. When a member-dealer's
accumulated funds total at least $2,000, we apply $2,000 to the purchase of 10
shares of Class B Common Stock and 10 shares of preferred stock and retain any
amounts above $2,000 until the accumulated amounts again equal the $2,000
required for additional purchases. Our board may, but traditionally does not,
include the amount of purchases made by a member-dealer directly from the
manufacturer when making the 2% calculation.
How to Calculate the Desired Stock Ownership Level.
During March of each year, we calculate each member-dealer's desired
stock ownership level, which must be at least $10,000. We base each
member-dealer's desired stock ownership level on the amount of its total
merchandise purchases made during the January 1 to December 31 period of the
previous year. Each member-dealer's desired stock ownership is calculated as set
forth in the following table:
6
<PAGE>
<TABLE>
<CAPTION>
AMOUNT OF TOTAL
PURCHASE DESIRED STOCK OWNERSHIP
- -----------------------------------------------------------------------------------------------
<S> <C>
$1 to $250,000 $1.00 for every $ 8.00 of total purchases
$250,001 to $1.00 for every $ 8.00 of total purchases from $1 to $250,000
$500,000 + $1.00 for every $10.00 of total purchases from $250,001 to $500,000
$500,001 to $1.00 for every $ 8.00 of total purchases from $1 to $250,000
$750,000 + $1.00 for every $10.00 of total purchases from $250,001 to $500,000
+ $1.00 for every $13.33 of total purchases from $500,001 to $750,000
$750,001 to $1.00 for every $ 8.00 of total purchases from $1 to $250,000
$1,000,000 + $1.00 for every $10.00 of total purchases from $250,001 to $500,000
+ $1.00 for every $13.33 of total purchases from $500,001 to $750,000
+ $1.00 for every $20.00 of total purchases from $750,001 to $1,000,000
$1,000,001 $1.00 for every $ 8.00 of total purchases from $1 to $250,000
and above + $1.00 for every $10.00 of total purchases from $250,001 to $500,000
+ $1.00 for every $13.33 of total purchases from $500,001 to $750,000
+ $1.00 for every $20.00 of total purchases from $750,001 to $1,000,000
+ $1.00 for every $40.00 of total purchases over $1,000,000
</TABLE>
Example of How to Calculate a Member-Dealer's Desired Stock Ownership
Level.
On December 31, a member-dealer's actual stock ownership totaled
$32,000. The value of its total merchandise purchases made from January 1
to December 31 amounted to $300,000. For the first $250,000 of total
merchandise purchases, the member-dealer should own $1.00 of stock for each
$8.00 of total merchandise purchases, or $31,250. For the member-dealer's
remaining $50,000 of total merchandise purchases, it should own an
additional $1.00 of stock for each $10.00 of total merchandise purchases,
or $5,000, for a total desired stock ownership of $36,250. This amount is
$4,250 higher than the member-dealer's actual stock ownership on December
31. Thus, we will require the member-dealer to make additional purchases of
Class B Common Stock and preferred stock during the twelve month period
beginning April 1 of the following year.
When Actual Ownership is Greater than Desired Ownership.
If a member-dealer's actual stock ownership at year-end is equal to or
exceeds its desired stock ownership, it is not required to make additional stock
purchases during the twelve month period beginning April 1 of the following
year. However, a member-dealer may voluntarily continue to make additional
purchases of Class B Common Stock and preferred stock by paying to us amounts
equal to 2% of the member-dealer's warehouse purchases invoiced on each
statement.
Repurchases from Overinvested Member-Dealers.
Since 1991, we have offered to repurchase Class B Common Stock and
preferred stock from member-dealers whose actual stock ownership has exceeded
their desired stock ownership by $4,000 or more. Each year we offer to
repurchase one-fourth of the member-dealer's excess amount at that time, equally
divided between shares of Class B Common Stock and preferred stock. We
7
<PAGE>
repurchase the shares for their initial sales price of $100 per share. In 1999,
member-dealers resold to us approximately 11% of the shares eligible for
repurchase. We paid $26,800 for these 1999 repurchases. We intend to continue to
offer to repurchase from member-dealers their overinvested amounts eligible for
repurchase. Our ability to make such repurchases, however, will depend upon our
future results of operations, liquidity, capital needs and other financial
factors. We cannot assure you that repurchase offers will take place in the
future, or if so, in what amounts or over what time periods.
When Actual Stock Ownership is Less than Desired Stock Ownership
If we determine that a member-dealer's actual stock ownership level on
the previous December 31 was less than its desired stock ownership level, we
will begin in April of the following year to collect funds for the
member-dealer's purchase of additional Class B Common Stock and preferred stock.
We will continue to collect these funds for one year until the next March 31,
even after the member-dealer attains its desired stock ownership level. We
collect these funds by adding the 2% charge described above to the
member-dealer's billing statements. Until these funds total $2,000 and are
applied to purchase Class B Common Stock and preferred stock for that
member-dealer, we use the funds for working capital.
EXISTING MEMBER-DEALERS WHO OPEN NEW STORES
If a current member-dealer opens an additional store, we will treat the
new store, also known as a member-dealer affiliate, as a new member-dealer.
However, we require the member-dealer affiliate to make an initial purchase of
10 shares of preferred stock rather than 10 shares of Class A Common Stock. We
treat the member-dealer affiliate as an entirely separate entity when
determining required Class B Common Stock and preferred stock purchases. We
calculate a separate desired stock ownership level for the member-dealer
affiliate, and the member-dealer affiliate has its own account for its funds to
be used to purchase Class B Common Stock and preferred stock.
MANNER OF OFFERING
We will only offer and sell the securities offered in this prospectus in
the states of Texas, Louisiana, Mississippi, Alabama, Florida, Oklahoma and
Arkansas, as well as in Mexico and Central America. Employees who are licensed
to sell securities in those states or who are exempt from licensing requirements
will sell these securities. We have not employed an underwriter for this
offering nor will we pay discounts or commissions in making these sales of
shares.
DESCRIPTION OF CAPITAL STOCK
Our Articles of Incorporation authorize us to issue 20,000 shares of
Class A Common Stock, 100,000 shares of Class B Common Stock and 100,000 shares
of preferred stock, each with a $100 par value per share.
CLASS A COMMON STOCK AND CLASS B COMMON STOCK
Class A common stockholders must engage in the retail sale of goods and
merchandise. No member-dealer may own more than 10 shares of Class A Common
Stock. When we submit matters for shareholder vote, a member-dealer receives one
vote for each share of Class A Common Stock it owns. Our board consists of ten
directors, and at each annual meeting, our Class A common stockholders elect
three directors, each to serve a three year term, and one additional director to
8
<PAGE>
serve a one year term as both a director and as President. Class B common
stockholders may not vote on matters submitted to a shareholder vote, except as
required by the Texas Business Corporation Act or in the unusual circumstances
of matters which would change their rights as shareholders.
Class A and Class B common stockholders have no preemptive rights to
purchase any securities. Upon the liquidation and distribution of our assets,
holders of preferred stock will be paid first, with holders of Class A and Class
B Common Stock sharing ratably in the distribution of the remaining assets. As
of March 31, 2000, there were 925 holders of record of Class A Common Stock and
788 holders of record of Class B Common Stock.
Class A common stockholders must offer to sell their shares to us before
selling them to a third person. We do not restrict transfer of Class B Common
Stock. We believe that member-dealers or former member-dealers own all shares of
our Class A Common Stock and member-dealers, former member-dealers or
member-dealer affiliates own all shares of our Class B Common Stock.
PREFERRED STOCK
Preferred stockholders are entitled to receive cumulative dividends.
According to our Articles of Incorporation, our board declares these dividends,
which must range from 7-20% of the $100 purchase price per share. Each share of
preferred stock has a $100 per share liquidation value. The preferred stock
dividend is the only form of return on stock investment in Handy. Preferred
stockholders are not entitled to vote on matters submitted to a vote of
shareholders, except as required by the Texas Business Corporation Act or in the
unusual circumstances of matters which would change their rights as
shareholders. Preferred stockholders may not convert their shares to common
stock. However, our board, at its option, may vote to redeem these shares in
exchange for $100 per share and all accrued unpaid dividends. We have no
obligation to redeem the preferred stock or provide for a sinking fund for the
redemption of such shares.
We do not restrict the transfer of preferred stock. However, we believe
that member-dealers, former member-dealers or member-dealer affiliates own all
shares of our preferred stock. As of March 31, 2000, there were 858 holders of
preferred stock.
SUMMARY OF DEALER CONTRACT
We require each member-dealer to enter into a dealer contract with us.
Under the dealer contract, we agree to sell merchandise and furnish services to
the member-dealer at our cost, plus freight costs and a small mark-up. We sell
the merchandise to each member-dealer f.o.b. our warehouse. Our trucks or common
carrier deliver merchandise at charges we set. We also agree to permit the
member- dealer to use the trade name "Handy Hardware Store" and agree to furnish
signs, a general catalog and other materials to the member-dealer for its
operation as a Handy Hardware Store.
Under the contract, the member-dealer agrees to enter into a stock
subscription agreement to purchase our securities. In addition, the dealer
contract requires the member-dealer to pay an initial service charge, currently
set at $200, to defray in part the costs of establishing their new account. The
member-dealer must maintain in confidence all materials we provide and, upon
termination of the dealer contract, must return all materials we furnished. The
member-dealer also agrees to order merchandise from us, to pay all invoices when
due and to attend trade shows and other member-dealer meetings. However, the
dealer contract does not impose on the member-dealer any minimum inventory
9
<PAGE>
purchase amount to remain a member-dealer. Either we or the member-dealer may
cancel the dealer contract upon 60 days notice.
LEGAL MATTERS
The validity of our securities offered in this prospectus has been
passed upon by Jenkens & Gilchrist, A Professional Corporation, Houston, Texas.
EXPERTS
The financial statements included in our 1999 Annual Report on Form
10-K have been examined by Clyde D. Thomas & Company, P.C., independent public
accountants, as stated in their opinion incorporated herein by reference. The
financial statements referred to above are incorporated herein by reference in
reliance upon such report and upon that firm's authority as experts in
accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
AVAILABLE INFORMATION
Our SEC filings are available to the public over the Internet at the
SEC's web site at http://www.sec.gov. You may also read and copy any document we
file at the SEC's Public Reference Room at 450 Fifth Street, N.W. Washington,
D.C. 20549. You may obtain information on the operation of the Public Reference
Room by calling the SEC at 1-800-SEC-0330.
We have filed a registration statement with the SEC on Form S-2 to
register the securities offered in this prospectus. This prospectus is part of
such registration statement. As allowed by SEC rules, this prospectus does not
contain all the information in the registration statement or in the exhibits to
the registration statement.
INCORPORATION OF DOCUMENTS BY REFERENCE
The SEC allows us to include information in this document by
"incorporating by reference," which means that we can disclose important
information to you by referring to those documents. Our Annual Report on Form
10-K for the fiscal year ended December 31, 1999 that has been filed with the
SEC is incorporated by reference in this prospectus, along with any future
filings made with the SEC under Sections 13(a) and 15(d) of the Exchange Act.
You may request a copy of any document incorporated by reference in this
prospectus, at no cost, by writing or telephoning us at our headquarters:
Handy Hardware Wholesale, Inc.
8300 Tewantin Drive
Houston, Texas 77061
(713) 644-1495
10
<PAGE>
PART II
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated offering expenses are:
SEC registration fee $ 972
Printing expense 570
Legal fees and expenses 12,000
Blue sky fees and expenses 7,500
Accounting fees and expenses 2,500
--------
TOTAL $ 23,542
---------
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article 2.02-1 of the Texas Business Corporation Act provides that a
corporation may indemnify its officers, directors, employees and agents for
expenses and costs incurred in certain proceedings arising out of actions taken
in their official capacity only if such persons were acting in good faith and in
a manner reasonably believed to be in or not opposed to the best interests of
the corporation, except in relation to matters in which they have been found
liable to the corporation, or on the basis that personal benefit was improperly
received regardless of whether or not the benefit resulted from action taken in
their official capacity. In the case of any criminal proceeding, such persons
must also have had no reasonable cause to believe such conduct was unlawful.
Article 2.02-1 further provides that a corporation shall indemnify its officers
and directors against reasonable expenses incurred in connection with
proceedings arising out of actions taken in their official capacity in which
such persons have been wholly successful, on the merits or otherwise, in the
defense of such actions.
ITEM 16. EXHIBITS.
The following is a list of exhibits filed as part of this registration
statement.
Exhibit
Number
4.1 Specimen copy of certificate representing Class A
Common Stock. (Filed as Exhibit 4.1 to the Company's
Annual Report on Form 10-K for the year ended
December 31, 1983, and incorporated herein by
reference.)
4.2 Specimen copy of certificate representing Class B
Common Stock. (Filed as Exhibit 4.2 to the Company's
Annual Report on Form 10-K for the year ended
December 31, 1983, and incorporated herein by
reference.)
II-1
<PAGE>
4.3 Specimen copy of certificate representing
preferred stock. (Filed as Exhibit 4.3 to the
Company's Annual Report on Form 10-K for the year
ended December 31, 1983, and incorporated herein
by reference.)
4.4 Form of Subscription to Shares of Handy Hardware
Wholesale, Inc. for Class A Common Stock, Class B
Common Stock and preferred stock. (Filed as
Exhibit 4.4 to the Company's Registration
Statement No. 33-78556 on Form S-2 as originally
filed on May 5, 1994, and incorporated herein by
reference.)
5.1 Opinion of Jenkens & Gilchrist, A Professional
Corporation. (Filed as Exhibit 5.1 to this
Registration Statement as originally filed on
April 26, 1999, and incorporated herein by
reference.)
10.1 Split-Dollar Agreement dated November 13, 1991
between the Company and James D. Tipton. (Filed as
Exhibit 10.5 to the Company's Annual Report on
Form 10-K for the year ended December 31, 1991,
and incorporated herein by reference.)
10.2 Form of Dealer Contract (Alabama, Arkansas,
Florida, Louisiana, Oklahoma and Texas). (Filed as
Exhibit 10.7 to the Company's Registration
Statement No. 33- 78556 on Form S-2 as originally
filed on May 5, 1994, and incorporated herein by
reference.)
10.3 Form of Dealer Contract (Mississippi). (Filed as
Exhibit 10.8 to the Company's Registration
Statement No. 33-78556 on Form S-2 as originally
filed on May 5, 1994, and incorporated herein by
reference.)
10.4 Amendment and Restatement of Credit Agreement
dated April 30, 1996, between Texas Commerce Bank,
N.A., and Handy Hardware Wholesale, Inc. (Filed as
Exhibit 10.2 to the Company's Quarterly Report on
Form 10-Q for the quarter ended September 30,
1996, and incorporated herein by reference.)
(1) 10.5 Ninth Amendment to the Employment Agreement, as
amended, between Handy Hardware Wholesale, Inc.
and James D. Tipton dated December 31, 1998.
(Filed as Exhibit 10.13 to the Company's Annual
Report on Form 10-K for the year ended December
31, 1998, and incorporated herein by reference.)
10.6 Third Amendment to Amendment and Restatement of
Credit Agreement between Handy Hardware Wholesale,
Inc. and Chase Bank of Texas, National
Association, dated April 30, 1999. (Filed as
Exhibit 10.16 to the Company's Annual Report on
Form 10-K for the year ended December 31, 1999,
and incorporated herein by reference.)
10.7 Agreement for Wholesale Financing between the
Company and Deutsche Financial Services dated
March 9, 1999. (Filed as Exhibit 10.17 to the
Company's Annual Report on Form 10-K for the year
ended December 31, 1999, and incorporated herein
by reference.)
II-2
<PAGE>
11.1 Statement re computation of per share earnings.
(Filed as Exhibit 11.1 to the Company's Annual
Report on Form 10-K for the year ended December
31, 1999, and incorporated herein by reference.)
12.1 Statements re computation of ratios. (Omitted
because sufficiently described in this
Registration Statement under "Ratio of Earnings to
Combined Fixed Charges and Preferred Stock
Dividend Requirements" in the Prospectus.)
13.1 Annual Report to Security Holders. (Incorporated
by reference from the Company's Annual Report on
Form 10-K for the year ended December 31, 1999 as
previously filed with the Commission.)
(2) 23.1 Consent of Clyde D. Thomas & Company, P.C.
23.2 Consent of Jenkens & Gilchrist, A Professional
Corporation. (Contained in their opinion filed as
Exhibit 5.1 hereto.)
24.1 Powers of Attorney of Directors of the Company. (A
power of attorney was included as part of the
signature page contained in the original filing of
this Registration Statement.
(1) Management contract.
(2) Filed herewith.
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1993, as amended (the "1933 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; 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.
(2) That, for the purpose of determining any liability under the 1933
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.
II-3
<PAGE>
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(4) That, for purposes of determining any liability under the 1933 Act,
each filing of the Registrant's annual report pursuant to section 13(a) or
section 15(d) of the Securities Exchange Act of 1934, as amended (the "1934
Act") (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to section 15(d) of the 1934 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.
(5) To deliver or cause to be delivered with the prospectus or prior to
delivery of the prospectus, to each person to whom the prospectus is sent or
given, the latest annual report to security holders that is incorporated by
reference in the prospectus and furnished pursuant to and meeting the
requirement of Rule 14a-3 or Rule 14c-3 under the 1934 Act; and, where interim
financial information required to be present by Article 3 of Regulation S-X are
not set forth in the prospectus, to deliver or cause to be delivered to each
person to whom the prospectus is sent or given, the latest quarterly report on
Form 10-Q that is specifically incorporated by reference in the prospectus to
provide such interim financial information.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant, Handy Hardware Wholesale, Inc., certifies that it has reasonable
grounds to believe that it meets all of the requirements for filing on Form S-2
and has duly caused this registration statement to be signed on its behalf by
the undersigned, thereunto duly authorized in the City of Houston, State of
Texas on April 24, 2000.
HANDY HARDWARE WHOLESALE, INC.
/s/ James D. Tipton
-----------------------------------------
James D. Tipton
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ James D. Tipton President, Chief Executive April 24, 2000
- ------------------- Officer and Director
James D. Tipton*
/s/ Tina S. Kirbie Chief Financial and April 24, 2000
- ------------------- Accounting Officer
Tina S. Kirbie*
/s/ Weldon D. Bailey Director April 24, 2000
- -------------------
Weldon D. Bailey*
/s/ Norman J. Bering, II Director April 24, 2000
- -------------------
Norman J. Bering, II*
/s/ Susie Bracht-Black Director April 24, 2000
- -------------------
Susie Bracht-Black*
/s/ Virgil H. Cox Director April 24, 2000
- -------------------
Virgil H. Cox*
<PAGE>
/s/ Samuel J. Dyson Director April 24, 2000
- -------------------
Samuel J. Dyson*
/s/ Robert L. Eilers Director April 24, 2000
- -------------------
Robert L.Eilers*
/s/ Richard Lubke Director April 24, 2000
- -------------------
Richard Lubke*
/s/ Jimmy Pate Director April 24, 2000
- -------------------
Jimmy Pate*
/s/ Leroy Wellborn Director April 24, 2000
- -------------------
Leroy Wellborn*
*By: /S/ James D. Tipton
-----------------------------------
James D. Tipton Attorney-in-Fact
pursuant to power of attorney contained
in original filing of this Registration Statement.
EXHIBIT 23.1
CONSENT OF CLYDE D. THOMAS & COMPANY, P.C.
<PAGE>
CONSENT OF CERTIFIED PUBLIC ACCOUNTANTS
We consent to the incorporation by reference herein of our report
included in Handy Hardware Wholesale, Inc.'s Annual Report on Form 10-K for the
year ended December 31, 1999, and the reference to our firm under the heading
"Experts" in the Prospectus.
/s/ Clyde D. Thomas
-------------------------------
CLYDE D. THOMAS & COMPANY, P.C.
Certified Public Accountants
April 24, 2000
Pasadena, Texas
